Married couples shopping for long-term care (LTC) insurance might consider a shared-care plan, which is not an option in the Federal Long-Term Care Insurance Program.
Suppose that Dan and Diane are both age 55 when they buy LTC insurance. They want policies that will pay $170 a day for nursing home care, with that benefit increasing 5 percent a year, to keep up with inflation
They could buy two individual policies that would each have a three-year benefit period. Their total cost might be around $2,000 a year.
They could buy two individual policies that would each pay lifetime benefits. Their total cost might be around $4,000 a year.
As a third alternative, they could buy a three-year shared-care plan, for six years of total benefits. The total cost might be around $2,600 a year. Their six years of benefits would be divided between the spouses, depending on who needs the care. By buying the shared-care plan, the Johnsons would be betting that six years of benefits will be adequate for both of them. Studies indicate that the average length of time that LTC is needed is 2.5 years so six years of total coverage might be enough for a married couple.
Shared-care plans might range from two years to seven years so a couple could get as much as 14 years of coverage to split between them. The more coverage you buy, the higher the annual cost, but you still would pay less than you’d pay for two lifetime policies.