What Is Long-Term Care Insurance?Whether a business owner purchases it to offer a valuable employee benefit, or an individual uses it to protect an elderly parent, long-term care insurance (LTC) is coverage designed to help pay for extended medical and non-medical services that would otherwise be paid out-of-pocket. In 2007, 8 million Americans were protected with LTC, with $3.5 billion in long-term care claims paid, according to the American Association for Long-Term Care Insurance (AALTCI).While some LTC insurance plans cover nursing home care, other plans provide coverage for a range of services including care in an adult day care center, assisted living, and formal or informal in-home care. LTC insurance plans pay benefits to you and anyone else you designate, such as a spouse, parent, or child. Depending on the policy, it will either pay a fixed amount or reimburse you for services provided.Do I Need It?Similar to homeowners, health, and auto insurance, LTC insurance helps protect you, your loved ones, and your assets. When an elderly person falls ill and lacks insurance, the burden to pay for medical care often falls on family members – and that cost can be substantial.Considering the emotional struggles that result when a loved one requires this type of care, the last thing you’ll want to think about is a steep financial burden as well, and LTC insurance plans help you avoid this added stress.How Does It Differ From Disability Insurance and Health Insurance?Medical insurance and disability insurance do not protect you and your family in the same way that long-term care insurance does. In fact, health insurance plans typically cover only 30 days of recuperative time, whereas LTC insurance plans often cover two years or more.Although disability insurance replaces your salary in the event of an injury, it fails to cover ongoing medical care. Medicare is even more restrictive, reimbursing you on average only 28 days, with a maximum of 100 days.How Much Does It Cost?Premiums vary, depending on your age and health conditions when you purchase the policy, as well as the amount of coverage you desire. Although the cost of care in nursing homes and assisted living facilities varies from state to state, the average yearly cost of a nursing home in 2010 reached $80,850, according to Long Term Care Insurance Tree.This represents a significant expense for many families, so it’s best to be prepared. Purchasing LTC insurance at a younger age is a smart idea, considering that you are likely to be healthier and receive a lower premium. However, the AALTCI reported that only 33 percent of all Americans who apply for this type of insurance apply at the age of 55 or younger.Coping with a parent, spouse, or child’s illness is never easy, but long-term care insurance can help protect you and your family. Contact your independent insurance agent to find the best policy for your family’s specific needs.