Can You Buy Long-Term Care Insurance for Your Parents?

Long-term care insurance provides financial protection for extended care services, including assistance with daily activities like bathing or dressing. Adult children can purchase this coverage for their parents, helping manage potential care expenses and offering peace of mind. Understanding the requirements and processes involved is important for this financial planning step.

Eligibility and Health Considerations

Eligibility for long-term care insurance depends on the parent’s age and health. Insurance companies employ a medical underwriting process to assess risk. This begins with a health questionnaire and a review of medical records, covering the last three to five years. Insurers can also require a phone interview or an in-person health assessment, especially for older applicants, which may include a cognitive evaluation.

Health conditions affect eligibility or result in higher premiums. Conditions like Alzheimer’s, dementia, Parkinson’s, ALS, MS, or kidney failure can lead to denial. Individuals already requiring assistance with activities of daily living (ADLs), like eating or transferring, are not eligible. Recent major medical events, such as a heart attack or surgery, can also result in a temporary waiting period or denial.

Age impacts policy availability and cost. While no universal age limit exists, most insurers set an upper threshold for new policies, typically 75 to 80 years old, with some extending to 85. Applying at younger ages, between 50 and 65, leads to lower premiums and a higher likelihood of approval. For instance, the denial rate for applicants aged 70 and older can be as high as 47%, compared to a lower rate for those in their 40s.

Policy Ownership and Payment

When an adult child purchases long-term care insurance for a parent, policy ownership is important. The child can pay the premiums for the policy, but ownership resides with either the parent or the child. If the parent owns the policy, they maintain control over its benefits and future coverage decisions. If the child owns the policy, they have direct control, beneficial for managing the policy.

Premium payments for a parent’s long-term care insurance offer limited tax deductibility. These premiums are treated as medical expenses and can be included in itemized deductions on the child’s federal tax return. However, this deduction is subject to an adjusted gross income (AGI) threshold, meaning medical expenses must exceed 7.5% of AGI to be deductible. Additionally, the amount of premiums that can be deducted is capped annually based on the insured individual’s age.

In 2025, the maximum deductible amount for someone aged 71 and older is $6,020. These tax benefits apply only if the taxpayer itemizes deductions, not if they take the standard deduction. Benefits from a qualified long-term care policy are tax-free. While the child can pay the premiums, the policy benefits are paid directly to the care provider or reimbursed to the policyholder, regardless of who pays.

The Application and Underwriting Process

Securing long-term care insurance for a parent begins by contacting a licensed insurance agent or broker specializing in long-term care. This professional helps navigate policy options and underwriting requirements. The next step involves completing an application form, gathering personal details and health information about the parent.

After application submission, medical underwriting commences. Insurers request medical records from the parent’s physicians, covering several years of history. A prescription drug check is common to verify medications and assess health. Depending on the parent’s age and health, a phone interview or an in-person assessment can be scheduled, during which a medical professional can conduct a cognitive evaluation and verify health details.

The underwriting process, from application to final decision, can take several weeks, typically five to eight weeks. After review, the insurer issues a decision, which can be an approval, denial, or an offer with modified terms, such as higher premiums or exclusions. If approved, the policy is delivered, and a “free look” period (30 days) allows for review and cancellation with a full refund if the policy does not meet expectations.