Coverage Calculator
Use this interactive calculator to estimate how much LTC insurance coverage you might need. Adjust the inputs based on your situation to see personalized recommendations.
Coverage Calculator
Adjust the inputs below to estimate your ideal LTC insurance coverage.
Primary Care Type to Plan For
Your Recommended Coverage
With inflation protection: If you buy a policy today with 3% compound inflation, your $200/day benefit would grow to approximately $400/day by the time you need care.
Key Factors That Determine Your Coverage Needs
Several factors influence how much LTC insurance you should buy. Understanding these will help you make an informed decision.
Cost of Care in Your Area
Care costs vary dramatically by state and even by city. A nursing home in Louisiana costs about $5,800/month while the same care in Connecticut costs over $14,600/month.
- Research costs in your current state and potential retirement locations
- Urban areas typically cost 20-40% more than rural areas
- Consider where your family lives if you want to be near them
Your Health & Family History
Family history of conditions like Alzheimer's, Parkinson's, or stroke may indicate a higher likelihood or longer duration of care needs.
- Review your family history for chronic conditions requiring extended care
- Women typically need care longer than men (3.7 vs 2.2 years on average)
- Current health affects both your coverage needs and insurability
Your Support System
Having a spouse, children, or other family members who can provide some care may reduce how much professional care you'll need.
- Consider if your spouse could realistically provide care
- Factor in whether adult children live nearby and can help
- Remember that family caregivers often burn out after 1-2 years
Your Financial Resources
The more assets you have to protect, the more coverage may make sense. But you should also consider what you can self-fund.
- Calculate how much you could pay out-of-pocket if needed
- Consider protecting assets you want to leave to heirs
- Remember that Medicaid requires spending down to ~$2,000
Choosing Your Daily or Monthly Benefit
Your daily (or monthly) benefit is the maximum amount your policy will pay per day (or month) toward your care. Here's how to determine the right amount:
The Formula
Daily Benefit = (Monthly Care Cost ÷ 30) × Coverage %
For example, if nursing home care costs $9,000/month in your area and you want 75% coverage:
($9,000 ÷ 30) × 0.75 = $225/day
Common Daily Benefit Amounts
Important Note on Pool-of-Money Policies
Most modern policies use a "pool of money" approach. If your daily benefit is $250 but you only use $200/day, the unused $50 stays in your pool for future use. This flexibility means your benefits can last longer than your stated benefit period.
Selecting Your Benefit Period
Your benefit period determines how long your policy will pay benefits. Combined with your daily benefit, this creates your total "pool of money."
| Period | Pool at $250/day | Best For |
|---|---|---|
| 2 years | $182,500 | Budget-conscious, healthy family history |
| 3 years ★ | $273,750 | Most popular, covers average need |
| 4 years | $365,000 | Above-average protection |
| 5 years | $456,250 | Family history of dementia/Alzheimer's |
| Lifetime | Unlimited | Maximum protection (highest premium) |
Average Care Duration
- • Overall average: 3 years
- • Men: 2.2 years
- • Women: 3.7 years
- • Alzheimer's: 4-8 years
Considerations
- • Family health history
- • Your gender (women need longer)
- • Available family support
- • Budget for premiums
Inflation Protection: Critical for Future Coverage
Without inflation protection, your coverage loses purchasing power every year. A $250/day benefit that covers 100% of costs today might only cover 50% in 20 years.
The Power of Compound Inflation Protection
Types of Inflation Protection
3% Compound (Recommended)
Best ValueBenefits increase by 3% each year, compounding on the previous year's amount. Provides strong protection at a reasonable premium increase.
5% Compound
Maximum ProtectionMore aggressive protection that better matches historical care cost increases. Significantly higher premiums but best long-term protection.
Simple Inflation
Budget OptionBenefits increase by a fixed dollar amount each year (e.g., 3% of original benefit). Lower premiums but provides less protection over time.
Future Purchase Option
FlexibleOption to buy additional coverage at set intervals without medical underwriting. Lower initial premiums but requires discipline to exercise options.
Warning: No Inflation Protection
If you're under 70 and buy a policy without inflation protection, your benefits could lose 50% or more of their purchasing power by the time you need care. We strongly recommend at least 3% compound inflation for anyone buying coverage before age 65.
Coverage Strategies
There's no one-size-fits-all approach to LTC coverage. Here are common strategies our clients use based on their goals and resources.
Full Coverage
100% of projected costsBuy enough coverage to pay for all expected care costs, leaving savings and income untouched.
Pros
- +Maximum asset protection
- +No out-of-pocket care costs
- +Peace of mind for family
Cons
- −Highest premiums
- −May be over-insured
- −Less budget for other needs
Best For:
Those with significant assets to protect and who prioritize maximum security.
Partnership Coverage
75% of projected costsCover most costs with insurance while planning to supplement with income or modest savings draws.
Pros
- +Balanced protection and affordability
- +Still protects most assets
- +Most common approach
Cons
- −Some out-of-pocket costs
- −Requires financial planning
Best For:
Most people seeking meaningful protection without the highest premiums.
Catastrophic Coverage
50-60% of projected costsInsure against the worst-case scenario while self-funding routine or shorter care needs.
Pros
- +Lower premiums
- +Still protects against major costs
- +Longer benefit period possible
Cons
- −Significant self-funding required
- −May deplete more savings
Best For:
Those with solid savings who want protection against extended care needs.
Shared Care (Couples)
Combined pool for both spousesSpouses share a single pool of benefits, allowing either to draw from the combined amount.
Pros
- +Flexibility if one needs more care
- +Often cheaper than two separate policies
- +Survivor benefits if one passes
Cons
- −Risk if both need extended care
- −More complex policy structure
Best For:
Married couples who want flexibility and cost savings.