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Paying for Senior Care: Women vs. Insurance

Sarah Stevenson
By Sarah StevensonAugust 11, 2015

More companies are rolling out gender-based pricing policies for long-term care insurance (LTCI). Why has there been a change in rates, and is there any way to minimize costs?

Learn more about women and LTCI.

Paying for Senior Care

Women live longer than men — 81 years on average in the U.S., according to data by the Institute for Health Metrics and Evaluation. Now, it looks like women are going to be paying the price for that extra longevity.

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The Wall Street Journal’s MarketWatch recently reported that women who apply individually for long-term care insurance will soon see rates that are 20-40% higher than they currently are.

Genworth, the nation’s largest LTC insurer, will be rolling out this increase in 30 states, and other industry competitors are expected to follow suit.

Women vs. Higher Long-Term Care Insurance Rates

Why are insurance companies raising women’s rates? Part of the answer has to do with longevity.

Women live longer and increased longevity translates to more unhealthy years on average for women — 11 years, compared to 9.7 for men. Of course, both men and women suffer more from health disorders after age 55, but women are less likely to seek adequate treatment for some issues, like high blood pressure and high cholesterol.

All of this means that women utilize long-term care and insurance very differently. Women account for 70-80% of LTCI claims and they are more likely to live alone in older age or to be a caregiver for their spouse. Conversely, women who need care themselves in old age are less likely to have a family caregiver, which may further increase their potential expense to the insurance company.

Married couples who apply for coverage jointly will still receive a substantial discount — when one half of a couple gets ill, often the healthy spouse takes care of the sick one, so the cost to insurers is lower. But if a woman loses her spouse, she’ll also lose his discount, and her rates will increase.

How to Minimize the Costs of Senior Care

Long term care insurance is not for everyone. Fortunately, there are other options for financing senior care, such as Veteran’s benefits and  life insurance policies with a long-term care rider. The bottom line, though, is retirement planning and preparing for long term senior care pays off. If you already know you’re interested in LTC, now’s the time for women and married couples to consider buying a policy.

For women who do plan to apply for LTCI, experts suggest that you apply as soon as possible so that you don’t get caught in the rate increase. Couples should also consider buying a policy while married, in order to get the benefits of the couples discount.

Executive director of the American Association for Long-Term Care Insurance, Jesse Slome, says in a press release:

“Women have the greatest need to do some long term care planning, but the opportunity to take advantage of currently available low rates will end soon.”

Slome also suggests being a “prudent shopper,” making sure your insurance agent has plenty of experience with LTCI and is able to help you do a cost-benefit comparison with multiple insurers.

Do you think women will continue to purchase long term care insurance now that they’re charged higher rates? What did you do? Share your thoughts with us in the comments below.

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Sarah Stevenson
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Sarah Stevenson
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