# What Is Long-Term Care Insurance?
Long-term care insurance covers the cost of assistance with daily living activities when age, illness, or injury makes independence difficult. This includes help with bathing, dressing, eating, and medication management, either at home or in a facility like a nursing home or assisted living center.
The average cost of long-term care runs steep. A semi-private nursing home room costs roughly $108,405 per year, while in-home care averages $61,776 annually for 44 hours per week. These expenses drain savings quickly without insurance protection.
Long-term care policies vary widely. Some cover only nursing homes. Others include home care, assisted living, and adult day care. Most policies require a waiting period, or elimination period, of 30 to 100 days before benefits begin. You pay out of pocket during this time. Benefit periods range from two years to lifetime coverage. Longer periods cost more but provide stronger protection.
Premiums depend on age, health status, and coverage amount. A 55-year-old purchasing a policy with a $200 daily benefit and a three-year benefit period might pay $1,500 to $3,000 annually. Wait until age 65, and premiums jump to $2,500 to $5,500 yearly. Age 75 policies cost $5,000 to $10,000 or more per year. Some policies include inflation riders that increase benefits over time, adding 1 to 3 percent annually to premiums.
Not everyone needs this insurance. Those with substantial assets can self-insure. People with limited income may qualify for Medicaid, which covers long-term care after depleting resources. The sweet spot for coverage typically falls between ages 55 and 65, before health issues emerge that might make policies unaffordable