I'm sorry to hear you had to put your mother in a care facility.
Long-term care insurance is a nice idea in theory. But I don't think than any of the current plans I've seen live up to the promise and offer a good value for the money.
Honestly, I think you are probably better off taking an extra $3500 per year and investing it.
I think that some of the issue that LTC insurance suffers from are:
1.) LTC insurers are going insolvent -- so premium payments end up being a waste.
2.) Insureds don't end up using the insurance during their end stages -- so premium payments end up being a waste.
3.) The coverage that is provided is not extraordinary -- most plans do not offer a blank check if you need long term care. The will offer a few thousand a month, usually for up to 5 years.
4.) There is a significant opportunity cost in that the money that goes towards the premiums could be saved, invested, and eventually used to self-insure against the need for long-term care (e.g. self insurance just means having enough extra money available to pay if its needed). And, if LTC is not used, the money that would have gone towards premiums could be used for other needs or left as an inheritance.
1.) LTC insurers are going insolvent -- so premium payments end up being a waste.
Fortunately, that's not true. The one insurance company that went belly up (Penn Treaty) didn't sell normal long-term care insurance. They ignored federal guidelines and sold policies that would pay benefits if someone needed help cooking and cleaning. No wonder they went bankrupt. No other insurance company has been dumb enough to sell policies like that.
2.) Insureds don't end up using the insurance during their end stages -- so premium payments end up being a waste.
There have been over 1,000,000 long-term care insurance policyholders who have made claims on their policies. Incurred claims are over $100 billion to date. This year, long-term care insurers will incur over $1 Billion in claims every three and a half weeks.
At the end of last year, after spending over $15,000 on medical insurance premiums on my family, I was not disappointed that the premiums "ended up being a waste". "Darn, I wish I'd had major surgery!"
3.) The coverage that is provided is not extraordinary -- most plans do not offer a blank check if you need long term care. The will offer a few thousand a month, usually for up to 5 years.
The OP can buy a $10,000 monthly benefit and $1,000,000 of shared benefits for about $150 per month per spouse. That's pretty extraordinary, don't you think?
4.) There is a significant opportunity cost in that the money that goes towards the premiums could be saved, invested, and eventually used to self-insure against the need for long-term care (e.g. self insurance just means having enough extra money available to pay if its needed). And, if LTC is not used, the money that would have gone towards premiums could be used for other needs or left as an inheritance.
The only problem with self-insuring is not knowing when you'll need care. If you can get a decent policy for less than one-half of one percent of your net worth, it makes sense to do it.