Deciding if long-term care insurance is right for you

To make the most of any insurance policy, you need to understand what it does and does not cover. For example, you might be surprised to learn that the costs of most long-term care services (like nursing-home care or the help of a home-health aide) aren’t covered by traditional health insurance, disability coverage, or Medicare.

Another surprising fact is that about 70% of individuals over age 65 will need long-term care services at some point in their lives.¹ With statistics like that, you may want to consider long-term care insurance to help cover those costs—and protect your retirement savings.

Long-term care insurance is available through Hewlett Packard Enterprise and elsewhere, but before you buy, you have to understand how it works and whether it may be right for you.

How long-term care insurance works

Long-term care insurance is designed to cover the costs of long-term care services you may need due to illness, injury, or the aging process. Your premiums depend on the type and amount of services you choose to cover, your age when you buy the policy, and any additional customized benefits you may choose, such as inflation protection.

Long-term care insurance works a lot like other types of insurance: You pay premiums for coverage, and the policy pays (up to its limits) for long-term care when you need it. Most insurance companies use "benefit triggers" as criteria to determine when you’re eligible to receive benefits. The most common benefit triggers are needing help with two or more “Activities of Daily Living” (like eating, dressing, and bathing) or having a cognitive impairment (like Alzheimer’s disease). Once you begin receiving benefits, most policies will pay the costs of your long-term care for two to five years, but some companies offer policies that will pay long-term care costs for as long as you live. Typically, long-term care insurance premiums are waived while you’re receiving benefits.

Like other types of insurance, it’s important to consider your potential needs and purchase a policy before you need it, because you may not qualify for coverage if you’re in poor health or already receiving long-term care. Once you have a policy, your coverage cannot be canceled as long as you continue to pay your premiums and you have not reached the maximum lifetime benefit.

Things to consider before you buy

Before deciding whether long-term care insurance is right for you, ask yourself:

• What’s my family health history? Although family history isn’t a perfect predictor of your future health, think about the health patterns of your parents and grandparents. Did they experience health problems or chronic conditions that required extended care?
• Do I have family who can care for me? Your need for long-term care insurance may depend on your family situation. For example, if you’re married or have grown children, would one of your family members be able to care for you physically and financially if it became necessary?
• Do I want to leave an estate? By planning ahead for potential long-term care costs, you may be able to leave a greater estate to your heirs because you’ll be less likely to spend your financial resources paying for care.
• When should I buy coverage? This can be tough, because you don’t want to buy too late—or too early. Generally, the right time to apply for coverage is in your late fifties. Like life insurance, the longer you wait to buy, the more expensive your premium will be. Regardless of your age, keep in mind that costs for long-term care insurance are increasing overall.
• Can I afford coverage? Some experts recommend spending no more than 5% of your income on a long-term care policy. When you do the math, keep in mind that your premium is likely to rise over time. 

Long-term care insurance policies offer a good deal of choice, so you may want to consider different care options and benefit levels if you’re concerned about the cost. For example, you may be able to find less expensive premiums if you choose a lower daily benefit amount, a lower maximum lifetime benefit or a facility-care-only policy instead of a more comprehensive policy. Facility-care-only policies pay for care in a nursing home or assisted living facility, but not for care provided at home or in the community. This type of policy may work for you if you have family who can care for you at home, but you want coverage for facility care if and when you need it.

¹ Administration for Community Living | Who needs care | 2025

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