How much for a million dollars of LTC Coverage?

With Genworth introducing their latest LTC product this month (Flex 3), it means that almost every major carrier now has new, refreshed pricing with the most conservative actuarial assumptions. 

Based on that, what does it cost to get approximately $1,000,000 of shared LTC benefit for a couple?  Let's look at four of the leading carriers to see what their premiums are for a shared benefit plan of about $1,000,000.  These premiums are based on $300/day, 5 year benefit period, 90 day elimination period, shared benefit riders, and the most commonly issued underwriting class.

First, here are combined couples' annual premiums with 3% automatic compound inflation rider:

 

Age	Carrier 1 ($547K of benefit each partner)	Carrier 2 ($547K of benefit each partner)	Carrier 3 ($547K of benefit each partner)	Carrier 4 ($500K of benefit each partner)
40	$6,284	$5,812	$7,022	$7,598
50	$7,944	$7,709	$8,524	$9,154
60	$11,128	$10,362	$11,019	$11,739

 And here are combined couples' annual premiums with either no automatic inflation or guaranteed purchase options

Age	Carrier 1 ($547K of benefit each partner)	Carrier 2 ($547K of benefit each partner)	Carrier 3 ($547K of benefit each partner)	Carrier 4 ($500K of benefit each partner)
40	$5,264	$2,809	$3,188	$3,432
50	$5,458	$3,893	$4,089	$4,140
60	$7,070	$6,318	$6,561	$6,055

What do you think?  Buy automatic inflation or go with a guaranteed purchase option? Feel free to comment below.

Of course, with the average premium purchased for long-term care insurance being $5,000 per couple annually, a better comparison might be "how big a pool of money can you get for $5,000?"  That comparison will be coming up next week on this blog.

 

Comments

[LTCShop]

The sources I've seen contradict this statement:

with the average premium purchased for long-term care insurance being $5,000 per couple annually

The average premiums I've seen are closer to about $1,500 per year per spouse.

[LTCI Partners]

Thanks for the comment - we based the $5,000 couples premium on industry statistics - in the Annual Broker World LTC survey just released the average premium per policy is $2,311. 5,000 is a little above that but in the ballpark.