Long-Term Care (LTC) Analyzer

Compare buying LTC insurance vs self-insuring. Explore cash flows, NPVs, breakeven claim age, and the opportunity cost of investing premiums instead.

Ages & Timing

Current Age Max Age

Premiums

Premium Structure Premium Amount ($) Premium Inflation (%) Premium End Age Waiver of premium during claim Deductible Portion of Premium (%) Marginal Tax Rate (%)

Benefits

Daily Benefit Today ($/day) Benefit Inflation (%) Benefit Period (years) Elimination Period (days)

Care & Economics

Claim Start Age (scenario) Claim Duration (years) Annual Care Cost Today ($) Care Inflation (%) Probability Need Care (%) Discount Rate (%)

Investment Alternative

Investment Return (%) Tax Drag on Return (%)

Models what premiums could grow to if invested instead of paid to the carrier, then spends that pool down during the claim years.

Note: Assumptions are simplified for planning purposes and this tool is not insurance advice. Confirm policy design, premium structure, rider terms, policy charges, and tax treatment before making recommendations.

Summary

Breakeven Claim Age

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Premiums (PV cost)

Benefits @ Chosen Claim Age (PV)

Care Costs @ Chosen Claim Age (PV)

Expected NPV — Buy Policy

Expected NPV — Self-Insure

Expected NPV — Invest Premiums Instead

Investment Pool @ Claim Start

Years of Care Funded by Investment Pool

0.0

Remaining Burden After Investment Pool (PV)

Expected Advantage of Policy (Buy − Self-Insure)

Policy vs Invested-Premium Strategy (Expected NPV Buy − Expected NPV Invest)

Breakeven Curve — Claim Start Age

Cash Flow Timeline (Chosen Claim Age)

Investment Alternative Value at Claim Age

Strategy Burden Comparison (Chosen Claim Age, PV)

How to Read This

Buy Policy: expected cost reflects premiums plus any care costs not covered by the policy.
Self-Insure: expected cost reflects paying the full care burden yourself if care is needed.
Invest Premiums Instead: assumes premium dollars are invested, allowed to grow, and then spent down during the claim years.
Years of Care Funded: how much of the modeled claim period the invested premium pool can cover before depletion.
Remaining Burden: care costs still left after drawing down the investment pool.