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Long Term Care Insurance

What is it?

Long Term Care Insurance (LTCI) is designed to pay for in-home or nursing care in the event you are unable to perform a specific number of “activities of daily living” such as dressing, eating, or bathing. This condition can arise as a result of a serious injury or old age. It is worthy of note that LTCI is distinct and different from Disability Insurance (which simply replaces a portion of your income if you are sick or injured and cannot work). LTCI will pay the cost of having someone care for you while you are sick or injured.

When is it used?

Typically LTCI is associated with old age and needed toward the end of life. This is true but it also has a purpose while you are younger as well.

Our recommendation:

We suggest, if you qualify, obtaining a LTCI policy.


There are many reasons to justify buying LTCI. Consider the following questions: How else would you pay for care of this type if needed? If you have the assets to “self insure”, wouldn’t you rather see your wealth be used for other purposes? If you did not have it and needed care, would you want to burden your family or loved ones with this responsibility?

LTCI insurance also is useful in protecting younger families from financial hardship. If you were injured in a car accident and put on disability (assuming you have disability insurance) but required Long Term Care, how would you pay for it? Disability insurance protects your income only and is designed to cover a portion of your living expense if you cannot work. It does not cover the additional expense of a care provider helping you with activities of daily living. If this type of care is needed, you will need to find a family member, loved one, or LTCI. Clearly, in this situation, burdening your family or loved ones with this responsibility would not be your first choice.

Click here for an indepth article about Long Term Care.

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