A 55-year-old individual can expect to
pay $1,480 annually for $169,000 in current benefits, which would
grow to $354,000 of coverage by age 80, according to the 2011
Long-Term Care Insurance Price Index, an annual report from the American Association
for Long-Term Care Insurance, an industry group.
A 55-year-old couple purchasing
long-term care insurance protection can expect to pay $2,350 a per
year (combined) for about $338,000 of current benefits, which
would grow to about $800,000 of combined coverage for the couple
when they turn age 80. If the 55-year-old couple did not qualify
for preferred health discounts, but rather for standard rates as a
result of having one or more health issues, their cost would
increase by $325 annually.
The study found that rates for
comparable coverage from leading insurers could vary by between 41
and 48 percent.
According to Association research,
three-fourths (78 percent) of long-term care insurance policies
are bought by couples where either both or just one spouse
purchases coverage. The average age for individual purchasers is
57, with some 76.3 percent of purchases made between ages 45 and
64 according to the Association's research.
The 2011 Price Index analyzed costs for
couples at ages 55, 60 and 65. In addition, for the first time,
the analysis included a 3 percent compound inflation growth factor
versus the 5 percent formula that has been used in prior studies.
"More purchasers are opting for this formula which significantly
reduces the cost of coverage and can be quite adequate in terms of
future benefits," said Jesse Slome, the association's executive
director. The Price Index also looked at rates for policies
including the newer Shared
Care option whereby two policyholders can each access a
combined pool of benefits.
