Excerpt from the East Valley Tribune newspaper December 10. By Rebecca Warren, certified financial professional planner and certified senior adviser at Warren Financial Services.

As the long-term care (LTC) insurance market has matured over the past 20 years, features have been added to the costly policies to make them more attractive in a tougher economy. The IRS has helped out by making a portion of the premiums tax-deductible.

Enter the “shorter-term” long -term care policy for individuals who are willing to play the odds. These policies eliminate the “lifetime” feature in favor of a shorter time limit on benefits, usually between two and three years, currently the length of an average nursing home stay. These shorter-term plans can potentially cut the cost of average annual premiums in half, and if couples buy a combined policy, they potentially may cut the premium cost further.

The idea of lower-cost LTC insurance is certainly attractive, but it makes sense to get some advice and ask some very important questions before committing. You will need to assess how well-prepared your finances are to sustain a serious long-term illness with the current national average of $70,000 in annual nursing home bills that would not otherwise be covered by (health) insurance.

Rebecca Warren advises your to assess your health, but to understand that while you may be in good health now, this is still no guarantee that in the future you will only need two or three years of expenses. Warren also noted that 40% of long-term care is provided to individuals between the ages of 19 and 65.

Having a long term care safety net may be more important for women, since women typically live longer than men and individually women earn less than men. But financial resources need to be considered along with their health history.

And if you don’t want to go to a nursing home? The idea is to cover every eventuality. The best-designed policies will pay the same amount of benefit for a long-term care facility, assisted living facility, an adult day care center or in the home.

Another consideration Warren says is what’s the record of particular companies in this business. Over the past generation, more companies have gotten involved in the LTC insurance business, and it makes sense to see not only who the leaders are at the time you’re buying and what they’re offering, but how financially healthy these companies are and have been over the course of time.

Tags: adult day care, assisted living facility, long-term care insurance, LTC, nursing home