AARP long-term care insurance pays for help with daily living when you can no longer manage alone

AARP long-term care insurance is a policy you buy while you are relatively healthy that pays a daily or monthly benefit if you later need help with activities like bathing, dressing, eating, or using the toilet. The insurance does not cover medical care itself — your health insurance handles that — but rather the cost of someone helping you do everyday tasks, whether at home, in an assisted living community, or in a nursing home.

AARP does not underwrite the insurance itself. Instead, AARP members can purchase policies from insurance companies that AARP has negotiated group rates with. The most common carrier is New York Life, though others participate in the program. Because these are group policies negotiated through AARP, the premiums are often lower than what you would pay buying the same coverage on your own.

The policies are real long-term care insurance, not a supplement to Medicare or Medigap. Medicare does not pay for custodial care — the day-to-day help with bathing and dressing — which is what long-term care insurance covers. Understanding that difference matters, because many people assume Medicare will cover this and are shocked when it does not.

Key Takeaways

  • AARP long-term care insurance pays a daily benefit for help with bathing, dressing, eating, toileting, and other activities of daily living, not for medical care.
  • You buy the policy while you are healthy, and it pays out years or decades later if you need care — the younger and healthier you are when you buy, the lower your premium.
  • Policies sold through AARP are underwritten by insurance companies like New York Life, and premiums are negotiated group rates available only to AARP members.
  • You choose your daily benefit amount, benefit period, and elimination period (how long you wait before benefits start), and these choices directly affect your premium.
  • Long-term care insurance does not cover medical treatment, skilled nursing care paid by Medicare, or care you receive while in a hospital.

How the daily benefit and benefit period work

When you buy an AARP long-term care policy, you choose a daily benefit amount — typically ranging from $100 to $300 per day, though some policies go higher. If you need care and the policy pays out, you receive that amount each day you are receiving covered care. The daily benefit is meant to cover part or all of the cost of a home care aide, assisted living, or nursing home, depending on where you live and what level of care you need.

You also choose a benefit period — how long the policy will pay. Common options are 3 years, 5 years, or lifetime. A 3-year benefit period means the policy will pay your daily benefit for up to 3 years of care. A 5-year period covers 5 years. Lifetime means it will pay for as long as you need care, for the rest of your life. Lifetime coverage costs significantly more in premiums, but it removes the risk of running out of benefits partway through a long illness.

The math is straightforward: if you choose a $200 daily benefit and a 5-year benefit period, the policy will pay up to $200 per day for up to 5 years, totaling a maximum of roughly $365,000 (5 years × 365 days × $200). Once that pool is exhausted, the policy pays nothing more.

The elimination period and when benefits actually start

The elimination period is the number of days you must pay for care yourself before the insurance starts paying. Common elimination periods are 30, 60, or 90 days. If you choose a 90-day elimination period and you need care, you pay out of pocket for the first 90 days, and then the policy begins paying your daily benefit.

A longer elimination period means a lower premium, because the insurance company is taking on less risk. A 30-day elimination period costs more than a 90-day one, all else equal. Many people choose 90 days because they have savings they can use to cover that gap, and the premium savings are substantial.

The elimination period does not have to be consecutive days. Some policies allow you to accumulate elimination days — if you need care for 40 days, then stop, then need care again 6 months later for another 50 days, those days may count toward your 90-day elimination period. Check your specific policy language, because this varies.

What triggers a payout and what does not

AARP long-term care policies pay out when you cannot perform a certain number of activities of daily living (ADLs) without help. The standard ADLs are bathing, dressing, toileting, transferring (moving from bed to chair), continence, and eating. Most policies require that you be unable to perform at least two of these six activities before benefits begin.

Some policies also pay if you have severe cognitive impairment — such as advanced Alzheimer's disease — even if you can still physically perform the ADLs. This is an important distinction, because cognitive decline alone can trigger benefits under some policies but not others.

The policy does not pay for skilled nursing care that Medicare covers, such as physical therapy after a hospital stay or wound care ordered by a doctor. It does not pay for medical treatment itself. It does not pay for care you receive while you are an inpatient in a hospital or in a skilled nursing facility paid by Medicare. It does not pay for custodial care in a hospital setting. Understanding these exclusions prevents the shock of thinking you have coverage when you do not.

Premium costs and how age affects the price

Premiums for AARP long-term care insurance depend on your age when you buy, your health, your gender, the daily benefit amount you choose, the benefit period, and the elimination period. Because these policies are priced individually based on your health history, there is no single "cost" — two people the same age can pay very different premiums depending on their medical background.

Age is the largest factor. A 55-year-old buying a policy will pay far less per month than a 70-year-old buying the identical coverage. This is why financial advisors often recommend buying long-term care insurance in your late 50s or early 60s, before premiums climb steeply. Waiting until 75 or 80 means paying much higher premiums for fewer years of coverage before you might need it.

Women typically pay higher premiums than men for the same coverage, because women statistically live longer and are more likely to need long-term care. Some policies also increase premiums over time — either annually or at certain milestones — while others lock in a rate. Ask whether your premium is may provide to stay level or whether it can increase.

How to explore AARP long-term care insurance options

If you are an AARP member, you can contact AARP directly to learn about the long-term care insurance programs they currently offer. AARP's website has information about carriers, coverage options, and how to request a quote. You will need to answer health questions, and depending on your answers, you may be asked to complete a medical underwriting process.

Before you request a quote, think through what daily benefit amount makes sense for you. Research the cost of assisted living or home care in your area — a quick call to a local assisted living community or home care agency can tell you what they charge per day. That gives you a realistic number to use as your daily benefit.

Also decide how long an elimination period you can afford. If you have $30,000 in savings and you choose a 90-day elimination period, you can cover roughly 90 days of care at $300 per day. If you have less savings, a shorter elimination period might make sense, even though it costs more in premiums.

You do not have to buy through AARP. You can also purchase long-term care insurance directly from insurance companies like Genworth, Mutual of Omaha, or others. The AARP policies are straightforward group rates negotiated for members. Comparing quotes from both AARP and direct carriers is worth the time.

When long-term care insurance may not be the right fit

Long-term care insurance is not right for everyone. If your assets are very small — under $50,000 or so — you may be better served by planning to use Medicaid, which covers long-term care for people with limited income and assets. Medicaid has its own rules and restrictions, but it exists precisely for people who cannot afford private insurance or who cannot afford the care itself.

If your assets are very large — over $1 million — you may choose to self-insure, meaning you straightforward pay for care out of pocket when the time comes. The cost of premiums over 20 or 30 years may exceed what you would actually spend on care, especially if you remain healthy and never need it.

If you have a serious health condition now — such as Parkinson's disease, Alzheimer's disease, or recent cancer — you may not be able to purchase long-term care insurance at all, or only at very high premiums. Underwriting is strict, and pre-existing conditions often disqualify you or make the policy unaffordable.

Frequently Asked Questions

Can I buy AARP long-term care insurance if I am not yet 50?

Yes, though AARP membership itself requires you to be 50 or older. If you are under 50 and interested in long-term care insurance, you can purchase it directly from insurance companies without going through AARP. Buying younger means lower premiums, so it can be worth exploring even before you turn 50.

What happens to my premiums if I never use the policy?

You continue paying premiums for as long as you own the policy, whether you ever use it or not. If you die without ever needing care, the insurance company keeps the premiums you paid. Some policies offer a return-of-premium rider, which returns a portion of your premiums to your estate if you die without using the benefits, but this rider increases your monthly cost.

Can my premiums go up after I buy the policy?

This depends on the specific policy. Some AARP policies may provide that your rate will never increase. Others allow the insurance company to raise rates on an entire class of policyholders (not just you individually) if claims experience is worse than expected. Ask whether your policy has a may provide level premium or whether increases are possible.

Does long-term care insurance cover memory care or dementia?

Most AARP long-term care policies cover care for dementia and Alzheimer's disease, either through the ADL trigger (if you cannot perform two ADLs) or through a separate cognitive impairment trigger. However, the specific language varies by policy, so confirm this in writing before you buy.

What if I need care but my policy has already paid out its maximum benefit?

Once the policy has paid its maximum — whether that is 3 years, 5 years, or the lifetime limit — it pays nothing more. You then pay for care yourself or turn to Medicaid if you have spent down your assets enough to may have access to. This is why some people choose lifetime benefits, even though the premiums are higher.