We purchased LTC insurance (separate policies) in our late 40's. Our program is sponsored by the state pension fund, so the carrier cannot leave the business until the pension managers find a replacement carrier. Class-wide premium increases are allowed, as they are on every policy and type of insurance. You always have a risk with individual insurance. Many homeowners have had whopping price increases and declination of new coverage whenever there's a major catastrophe. That's the downside of a public, competitive marketplace. LTC is no different. All I would say is, don't limit yourself to just your employer's offerings. There are several groups that specialize in LTC insurance, so Google and contact them if you're really interested. Yes, you may get stuck on a few mailing or call lists, but those aren't a big deal and easy to remove yourself from, or just toss the envelopes. Don't let it stop you. Genworth is good, I don't know anything about MedAmerica, and Northwestern Mutual is also a very solid company who has publicly announced they intend to remain in the LTC marketplace. Always contact your State Insurance Dept. - often the info is on the web - to look at the number of complaints a company has had to report. Also remember that it's worth investing WHO the company actually is - Conseco, one of the very worst LTC insurers ever, wrote LTC policies under six different subsidiaries. The Net can be your best friend, if you are willing to take the time to track info down to the source. Don't expect someone else to do all the work for you, and any time you talk to an agent, always rely on what is WRITTEN, not what you think someone said or implied. Verbal and phone assurances are worth the paper they are written on, and no more. Why did we buy this complex, risky product? Because our calculations determined that the extended disability of one spouse would quickly use up the assets of the survivor. And under no scenario would our assets cover BOTH of us being disabled and needing home health care, for longer than a year's time. When life expectancy continues to increase, and the ability of the medical profession to keep you alive but with a lousy quality of life also continues to progress, it was not a hard decision to buy sooner rather than later. We budgeted for price increases. If you understand how insurance actuarial stats work, it was clear to me that the Boomers would live longer, thus requiring care of which our current medical system does not cover the cost. The old "my family will take care of me" attitude is inadequate, especially when families are scattered around the globe, many Boomers (like us) chose not to have any children, and the Millennials are having a hard enough time surviving without having elderly Boomers hang around their necks like a 200-lb albatross, looking for charity. For very comprehensive policies - unlimited benefit period, 3 month elimination, 5% compounded inflation benefit, 50% home healthcare (for new policies it's now 100% of benefit), 2 ADL disability definition: Me, example #1: Age 48, female when policy was purchased. Premiums slightly over $1200/yr. Premiums are now $2K/yr, after two class premium increases. I used to pull LTC quotes as part of my job, working in a CFP's office. My best guess is that if I went to apply for a policy now, age 60, overweight and pre-diabetic, an equivalent new policy premium would be approx $3500. DH, example #2: Age 46, high BP under moderate treatment. Premium started at $800/yr, now $1700/yr. At age 50, when the policy was 4 yrs old, DH suffered a serious haemorrhagic stroke. Fortunately he has recovered almost totally. However, no insurer would have written ANY policy on him for at least 5 yrs after the stroke. And they would definitely rate him as Standard, not Preferred, possibly Class 2 or even Class 3 risk, for being (now) age 59, slightly overweight, pre-diabetic, previous stroke, family history of heart attacks and diabetes (every male in his family died of cardiac failure before age 70). My best guess is that his premium for an equivalent policy would now be in the $5K to $7K annual range. So was buying LTC insurance 11 yrs ago a smart decision? Yes, for us it was. The total of all premiums we have paid are still less than the cost for six months for ONE of us in a nicer licensed care facility. You might find the link below useful. I like SmartMoney, which is the magazine arm of the same holding company as the Wall St. Journal. Here is a link that might be useful: SmartMoney LTC calculators

chisue, insurance companies don't make money strictly off policy premiums. AIG's current headline news is a perfect example of this. When I worked at CIGNA (formerly Connecticut General, then they bought INA and changed their name), each of their 5 separate divisions was given an annual profit margin target to hit. This was called a "zero margin plus xx%". Note this was not a sales number, it was a "quick and dirty" percentage of how much revenue minus division expenses they made annually. My boss (one of the regional VPs with a shot at the division presidency) got interested in exactly where this target number came from. He learned that what CIGNA called "zero margin" was actually a base 15% profit margin. CIGNA could earn 15% off its money, through investments and such things as real estate development (for instance they bankrolled Foster City, a landfill development in the SF Bay Area that was considered risky at the time, but is now a desirable mixed-use suburb, selling it after a few years for a hefty profit), without ever writing another insurance policy. Therefore, their divisions had to earn OVER that 15% profit margin, to be worth expending corporate funds for. This is why insurance companies go in and out of market niches - they tend to keep a fairly conservative eye on what their profit margins are on each line of business. When people are discussing the stock market, the majority of money in it is institutional. Insurance companies are a very large part of that. They are even better than banks at leveraging their money. We used to make jokes about actuaries, but insurance companies realistically suvive on the number-crunching abilities of their actuaries. Like developers in a software company, they are what actually drives the financial corporate engines.

Calculating at home care is fairly simple. You can contact any elderservices resource and they can get you or quote to you per diem care in your area. Here in the SF Bay Area, licensed home care is a bargain at $250/day. (This was negotiated by my former boss, an independent CFP, in 2006 for one of his elderly clients when the husband underwent surgery, so it's probably higher now) Almost all LTC policies will pay 100% of daily benefit for home care services in addition to licensed facilities, although cost is usually capped at a per-month amount. Again, if your net worth is sufficient, around $2M+, you can self-insure with reasonable confidence your estate can bear the costs. This assumes you don't care if anything is left for your heirs - many people don't, but there are a goodly number that do care, hence my caveat. There's really very little new about Fidelity's studies, they merely confirm what other sources have been saying for some time. It's a rough time to be thinking of additional expenditures. OTOH, if you are like a couple we know that just retired, it's even rougher to watch one's portfolio drop to the point where they're soon going to be breaking into principal. Since he's still 5 yrs from being able to claim Medicare, he's facing the unpalatable prospect of having to unretire. As an independent contractor without health insurance he's ended up in emergency twice in the last ten years, so he's very worried about LTC. I really feel for him, but I do think they should have opted for LTC insurance when they could have afforded it at a younger age. He's 60, she's 74, and any LTC care is going to wipe out their assets very quickly.

I wish I knew more about this topic myself so I can't argue either way - but something in my gut says your financial planner is giving you good advice to be cautious. I googled - explain long term care insurance - and the 4th. article from the bottom of the first page "Avoiding Fraud When Buying Long Term Care Insurance" might have just the kind of information you're looking for.