The upside: The health underwriting on life insurance is far less stringent than on traditional long-term care insurance. Plus, if you don't need long-term care, you won't lose your investment.
The downside: It will likely be more expensive. "If your LTC policy was going to be $6,000 a year per couple, you might face $12,000 a year in ongoing premiums for the life insurance," says Kisner. "Plus, you could exhaust your benefits over time."
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Annuity with home health or nursing home riders
"You purchase a deferred annuity," Kisner explains. "When you turn on the income stream six or eight years later, if you had put in $100,000, you can take out $7,900 a year for the rest of your life. The rider will double that amount if you need home health or nursing home care."
The upside: There's no medical underwriting, and you can't outlive the income stream.
The downside: Investing that much cash upfront takes guts.
Senior homeowners may be able to tap the equity in their home for long-term care expenses.
The upside: There's no physical or premiums.
The downside: The homeowners or their heirs will have to pay the loan back with interest at the end of the loan term or forfeit their home to the lender.
The old saw on long-term care insurance is: Those who need it can't afford it, and those who can afford it don't need it. The wealthy typically self-insure, meaning they fund long-term care out of their savings, while those of modest means spend down their savings to qualify for Medicaid.
"It's really the people in the middle -- (with net worth) between $200,000 and $1.5 million -- who need long-term care insurance the most," Kisner says.