Long term care is something that no one likes to think about, but unfortunately, many people will eventually need. Health care costs are skyrocketing, and a lengthy stay at a long-term care facility can easily bankrupt most people’s nest eggs. Long-term care insurance is one way to protect both yourself and your retirement savings.
Out of the few companies still offering traditional long-term care insurance, we recommend the following three companies for their product strengths, reasonable premiums, and reputation: Mutual of Omaha, Transamerica, and National Guardian Life.
We are able to get long-term care insurance quotes from these 3 companies. These quotes reflect information for a 50-year old woman in excellent health, no tobacco use. None of the quotes we got reflect an inflation option, although these are available at a higher cost. Below is the comparison of the three quotes:
| Mutual of Omaha | Transamerica | National Guardian Life | |
| Product | MutualCare Secure Solution | TransCare II 2016 | Essential LTC |
| Best for | Best for flexibility | Best for guaranteed rates and best rates | Best for couples |
| Max daily benefit | N/A | $200 | $200 |
| Benefit period | 4 years | 4 years | 4 years |
| Maximum monthly benefit | $6,000 | N/A | N/A |
| Total benefit | $288,000 ($6,000*48) | $292,000 ($200*365*4) | $292,000 ($200*365*4) |
| Annual premiums | $2,892 | $1,902 | $1,926 |
| Years of premium payment | Lifetime (10Y premium option is available) | Lifetime (10Y premium option is available) | Lifetime (10Y premium option is available) |
| Elimination period | 90 days | 90 days | 90 days |
| Special features | Shared care option for the spouse | Premiums guaranteed for 5 years | Return of premiums rider is available |
We also considered another 2 companies to make this list due to their popularities: New York Life and Genworth. However, we couldn’t get quotes from them. While we can’t compare quotes from these two companies with the three companies above, we include them in the comparison for your consideration. We actually include the two companies below in our list of the worst long-term care insurance companies.
- New York Life Long-Term Care Insurance: Best for Customer Service
- Genworth Long-Term Care Insurance: Best for Ummmm….
Mutual of Omaha: Best for Flexibility
- Maximum monthly benefit: $6,000
- Benefit period: Four years
- Total benefits: $288,000
- Annual Premium: $2,892
Mutual of Omaha offers a shared care option, which is a great choice. It’s available as a rider. With this rider, both you and your spouse can tap into the other’s long-term care benefit.
This is a flexible policy. You can choose how long you want the elimination period to be, anywhere from zero to 365 days. You can choose either a reimbursement plan, or cash indemnity. You can choose how long you receive benefits. All of these options affect the price but may be worth it.
If your spouse happens to be uninsurable, due to some chronic health condition, you can get them long-term care benefits through the Spouse Security benefit option.
Overall, this is a very customizable policy that could suit your needs.
>>MORE: Mutual Of Omaha (Traditional) Long-Term Care Insurance Review
Transamerica: Best for Guaranteed Rates and Best Rates
- Daily benefit: $200
- Total benefit: $292,000
- Benefit period: 4 years
- Annual Premium: $1,902
- Rate guarantee: Five years
- Return of premium: To age 67
The rate guarantee means your premiums are guaranteed not to increase for five years. Another nice feature is the cash benefit alternative. You can choose either the reimbursement plan, or you can elect to get 33% of the benefits in cash so you can pay for a home health aide.
Transamerica sells policies through agents, so you’ll have to call to set up an appointment.
There are some negative customer service reviews posted about Transamerica, so potential customers should be aware of this. Most of them concern slow response times and denial of claims.
>>MORE: Transamerica (Traditional) Long-Term Care Insurance Review
National Guardian Life: Best for Couples
- Daily benefit: $200
- Benefit period: Three years with a one-year benefit extension rider (so, four years)
- Total benefit: $288,000
- Annual Premium: $4,507 for ten years, or annually $1,926 for lifetime
National Guardian offers a lifetime benefit option, which is great for peace of mind. It may be important if you need long-term care for over five years.
They also offer Partnership protection with some states, which was created to help protect your assets should you run out of insurance. Not every state has this program, but if yours does, it’s worth getting.
Shared care: This optional rider essentially provides 50% more benefits for either you or your spouse if either of you need long-term care. This is an excellent benefit that could be quite a good value if you or your spouse need long-term care for an extended period of time.
>>MORE: National Guardian Life (Traditional) Long-Term Care Insurance Review
New York Life: Best for Customer Service But Extremely Expensive
New York Life offers two long-term care insurance options: MyCare and Secure Care. Secure Care has a pool of money you can draw from to pay for long-term care. MyCare plan replaces the elimination period with a deductible, which may work well for some, and your long-term care insurance starts as soon as the deductible is met. Lifetime benefits are anywhere from $50,000 to $250,000, and deductibles are anywhere from $4,500 to $21,000.
New York Life has paired with AARP to offer long-term care policies, although it’s unclear if this gets you a discount.
We could not get a quote from New York Life because they sell policies through agents and are fairly guarded about costs. We would guess that they’re on the expensive side. They have decent customer service reviews, and one of the highest ratings for financial strength. Be sure to get quotes from other companies to compare before you go with them.
>>MORE: New York Life Long-Term Care Insurance Review
Genworth: Best for Ummm….
Genworth used to sell long-term care insurance through agents, but now they have an “internal sales team” that sells policies. They still wouldn’t give us a quote, and you have to call to set up a consultation.
If you’re considering Genworth, there are a few things you should keep in mind. One is that there are a few class-action lawsuits against them for rate increases. Rates have increased and will continue to increase over the next five to seven years.
Another thing to keep in mind is that Genworth was sold to a Chinese holding company, China Oceanwide, for $2.7 billion dollars in 2016. The sale is still pending. It has been delayed multiple times for various reasons. A.M. Best ranked Genworth with a C++ for financial strength, which is one of the lowest rankings we’ve seen for a well-known insurance company.
We would hesitate before purchasing long-term care insurance from Genworth, as their financial strength is up in the air, and it seems like they’re stepping back from long-term care.
>>MORE: Genworth (Traditional) Long-Term Care Insurance Review
The Pros and Cons of Traditional Long-Term Care Insurance
You will need long-term care when you can’t perform at least 2 out of 6 activities of daily living (or ADLs) such as eating, bathing, moving, dressing, toileting, and grooming. Long-term care insurance will cover the cost of long-term care expenses. Traditional long-term care insurance has its own pros and cons.
The advantages of traditional long-term care insurance includes the following:
- It is much cheaper than hybrid long-term care insurance
- The chance you will need long-term care is high, 70% of those 65 and older will need some form of long-term care
- It will protects your retirement savings
The two biggest drawbacks of traditional long-term care insurance are:
- If you don’t need long-term care, all premiums that you have paid are wasted
- Premiums can increase significantly. Many insurance companies have been sued in several class actions law suits because they increased premiums too much.
How Much does Traditional Long-Term Care Insurance Cost?
Long-term care insurance is generally considered expensive. However, traditional long-term care insurance is much cheaper than hybrid long-term care insurance. Similar to life insurance, the premiums of traditional long-term care insurance depend on several factors such as your age, your health condition, daily LTC benefit, LTC benefit duration, individual or joint policy, with or without inflation protection, etc.
We obtained several traditional long-term care insurance quotes from National Guardian Life, one of a few reputable companies in the traditional long-term care insurance market, for different consumer profiles to give you an idea of its cost.
The quotes below are for non-smoking individuals with good health. These individuals choose to pay annual premiums for 10 years.
A traditional long-term care insurance policy providing $200 daily LTC benefit in 3 years can cost from $81 in monthly premiums to $435, depending on your gender and your age. The younger you are when you buy long-term care insurance, the cheaper your premiums are.
If you want 4 years of LTC benefits, instead of 3 years, the monthly premiums will be in the range of $186 – $500.
| Age | Sex | Daily LTC benefit | LTC duration (years) | Total LTC benefits | Traditional LTC (National Guardian Life) |
| 50 | M | $200 | 3 | $216,000 | $1,936.77 |
| 50 | F | $200 | 3 | $216,000 | $2,968.62 |
| 55 | M | $200 | 3 | $216,000 | $2,211.97 |
| 55 | F | $200 | 3 | $216,000 | $3,349.69 |
| 60 | M | $200 | 3 | $216,000 | $2,528.38 |
| 60 | F | $200 | 3 | $216,000 | $3,885.31 |
| 65 | M | $200 | 3 | $216,000 | $3,434.29 |
| 65 | F | $200 | 3 | $216,000 | $5,221.50 |
| 50 | M | $200 | 4 | $288,000 | $2,227.29 |
| 50 | F | $200 | 4 | $288,000 | $3,413.91 |
| 55 | M | $200 | 4 | $288,000 | $2,543.76 |
| 55 | F | $200 | 4 | $288,000 | $3,903.89 |
| 60 | M | $200 | 4 | $288,000 | $2,907.64 |
| 60 | F | $200 | 4 | $288,000 | $4,468.10 |
| 65 | M | $200 | 4 | $288,000 | $3,949.43 |
| 65 | F | $200 | 4 | $288,000 | $6,004.73 |
Is Long-Term Care Insurance Worth It?
70% of those 65 or older will need some kind of long-term care. Similar to health care, long-term care is getting more and more expensive. Without long-term care insurance, you’ll have to pay for long-term care out of your pocket and it can empty your retirement savings quickly.
Yes, long-term care insurance is worth it. Just less than $100 a month, you will be protected and taken care of when you need to. Buy a traditional long-term care insurance policy as early as you can, especially when you are still healthy. Some companies allow you to buy a policy when you are as young as 40 years old.
Last Thoughts
Long-term care insurance does have some advantages over hybrid life and long-term care policies. It’s less expensive and there’s usually a wider selection of care options. The only thing is, that should you not need long-term care, all that money you spent in premiums is like a gift to the insurance company. The odds are you or your spouse will need long-term care, but if you’re still on the fence, consider a hybrid policy. These policies combine long-term care with life insurance, so that if you don’t need long-term care, instead of having the money go back to the insurance company, your heirs get a nice death benefit.
>>MORE: How Much does Traditional Long-Term Care Insurance Cost?