Get the best long-term care insurance quote

A 55-year-old single man or woman who purchases long-term care insurance can pay $ 1,325 a year. However, they can pay up to $ 2,550 a year for nearly identical coverage.

What explains that one price is almost twice the other? Experts will tell you that it involves a variety of items, and understanding how to get the best quote for long-term care insurance can save you a lot of money now and for years to come.

That’s a very important point because, unlike other insurance products where you can shop for lower prices each year, long-term care insurance is generally purchased once and only once. Insurers base their prices on what’s called your age. Simply put, there is a price for someone 55 years old. Someone 56 years old will pay more. Someone 65 years old will pay a little more.

So why do prices for virtually identical coverage vary so much, and what questions can help you get the best coverage at the best price?

First, each insurer uses its own pricing factors to determine what it wants to charge. That includes profitability targets. In other words, a company can simply expect to get a lower return on each policy sold. Others hope to earn more and value accordingly. Unfortunately, that is not something the agent can tell you when researching this protection.

One thing they can tell you is when the policy was first issued in your state. That will give you an idea of ​​when the policy was priced. This is very important for a number of reasons. Older policies may have been priced when investment returns, particularly interest rates, were higher than they are today.

Research by the American Long-Term Care Insurance Association found that for a more than one percent decrease in interest yield on premiums, an insurer needs a 10 percent rate increase. Or, more simply put, if the particular policy shown to you was priced when interest rate returns were projected to be six percent a year and today they are three percent, the insurer has been losing money. The question is whether they will seek a rate increase to make up the gap. Your current savings could quickly disappear and you could find yourself paying more than you would if you bought a policy that uses more current prices.

Older policies may have used older drop rate assumptions as well. The drop rate assumption projects the percentage of people who purchase long-term care insurance and actually keep their policy until it is time to begin claiming benefits. Older policies tended to use higher assumptions. And that’s the main reason some older policies are seeking premium increases today.

Every company has price sweet spots and these can vary considerably. Some have more attractive prices for couples than for single people. Their experience shows that, in the case of couples, the spouse often provides care initially, maintaining a cap on claims costs. Others prefer those who are 50 years older than others.

Each company also determines what discounts it wants to offer and how large the discount will be. Some offer couples discounts when only one spouse or partner qualifies for coverage. Others will offer a more limited version.

All these variables make it vitally important that one search the market for this important protection. Finally, understand that not all insurance producers are the same. Some only have access to the policies of one insurer. Others are brokers and have access to several companies, usually five or six. That doesn’t make one better than the other, but it’s important to ask how many and specifically what companies are looking for when they come up with a quote for you.