Compare two long-term care insurance deductible options using annual premiums, deductibles, and your estimated claim probability. The calculator shows probability-weighted annual cost, expected savings, the break-even claim probability, and the extra cash exposure in a claim year. Use it to frame a policy choice, while also checking whether the larger deductible is affordable and whether the options have matching coverage terms.
Expected savings equals the lower-deductible option cost minus the higher-deductible option cost. Break-even probability equals premium savings divided by the deductible increase.
A positive expected saving favors the higher deductible on probability-weighted cost; a negative saving favors the lower deductible. The break-even probability shows how sensitive that result is to your risk estimate.
Insurance pricing and claims are uncertain. Confirm how the policy defines a deductible, elimination period, benefit period, and covered event.
With annual premiums of $2,400 and $1,900, deductibles of $1,000 and $3,000, and a 10% claim probability:
The higher-deductible option saves an expected $300 per year. Its break-even claim probability is 25%.
No. It lowers expected cost only when the premium savings outweigh the additional expected out-of-pocket claim cost under the assumptions entered.
Use your own reasonable annual estimate or a figure supplied by your insurer or adviser. The calculator does not assume a market-wide claim rate.
It is the annual claim probability at which both deductible options have the same expected annual cost. Below it, the higher-deductible option is cheaper on this model.
No. It models one deductible-bearing claim outcome per year. A policy with multiple deductibles or repeated claims needs a more detailed analysis.
Not automatically. Also consider whether you can comfortably pay the deductible, exclusions, benefit limits, and the financial impact of a claim year.
| Variable | Meaning | Unit |
|---|---|---|
| Annual premium | Price paid to keep the policy active | USD/year |
| Deductible | Modeled out-of-pocket amount per claim year | USD |
| Claim probability | Estimated chance of a deductible-bearing claim | %/year |