USAA Long-Term Care Insurance Review
July 13, 2025
What USAA Members Need to Know
As a USAA member, you have access to long-term care coverage through your membership benefits. However, before choosing this option, it’s important to understand exactly what type of coverage USAA provides and how it compares to other available options.
This comprehensive review analyzes USAA’s actual coverage structure, explores better alternatives in the market, and helps you determine whether this membership benefit truly meets your long-term care planning needs.
For over 30 years, ACACIA Insurance has specialized in long-term care planning as independent advisors, representing numerous highly rated insurance companies and plan types.
What long-term care insurance does USAA Offer?
USAA provides access to long-term care coverage, but the structure may surprise members expecting traditional LTC insurance:
- USAA offers hybrid long-term care insurance through a life insurance policy
- The coverage combines universal life insurance with a long-term care rider
- USAA does NOT offer traditional stand-alone long-term care insurance
The USAA coverage is a universal life insurance policy with an LTC rider, underwritten by John Hancock Life Insurance Company. This hybrid approach prioritizes the life insurance death benefit over comprehensive long-term care protection.
Important Distinction: Stand-alone long-term care (LTC) insurance policies are also referred to as “traditional long-term care insurance” and provide more focused LTC benefits than hybrid policies.
Is the USAA long-term care plan right for you?
Key points to consider:
- This Universal Life Insurance policy uses an accelerated death benefit rider.
- The death benefit of the life insurance policy is also the long-term care benefit amount. If the death benefit is accelerated for long-term care expenses, the death benefit is reduced dollar for dollar, and the cash value is reduced proportionally.
- There is NO extension of benefits like most hybrid long-term care insurance policies. The accelerated death benefit rider only uses the death benefit to pay for long-term care expenses.
- There is NO benefit increase rider (inflation protection) to keep your long-term care benefit in pace with rising long-term care costs.
How to compare USAA long-term care insurance
A useful comparison to the USAA long-term care insurance offering is the Nationwide Insurance universal life policy, as both are built on universal life insurance.
One notable distinction between these two plans is that the Nationwide policy includes a Cash Indemnity Benefit, which provides additional flexibility in how benefits are received.
How The Nationwide Cash Indemnity Benefit Works
The Cash Indemnity benefit works like this:
- Nationwide Insurance pays the entire long-term care benefit each month
- You have no restrictions on how you use your LTC benefits
- Even your family and friends can be paid to provide care
- The policy will pay 100% of benefits internationally
How Cash Indemnity differs from Reimbursement – Most long-term care insurance policies provide reimbursement benefits. With reimbursement benefits, bills and receipts must be submitted to the insurance carrier for approval. The insurance company then reviews the claim and reimburses the exact amount of approved expenses, up to the amount of the monthly benefit.
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Do I Need Long-Term Care Insurance?
Almost 70% of people turning age 65 today will need some type of long-term care in the future. The average length of time people need care is 3 years.1
One-third of people may never need long-term care, but 20% will need it for longer than 5 years. On average women need 3.7 years of care while men need 2.2 years.2
In 2025, the national average cost for 3 years of long-term care is $328,884 ($109,628 per year). That cost is projected to be $654,411 ($218,137 per year) in 2045.3
About Medicare and Long-Term Care
Medicare 
provides very limited long-term care coverage, primarily up to 100 days of skilled nursing care following a 3-day hospital stay. It does not cover custodial care (help with daily activities), which represents over 90% of long-term care needs. This limited coverage is why many people consider long-term care insurance. Get complete details about Medicare’s limited LTC coverage.
When To Buy Long-Term Care Insurance
When is the best age to get long-term care insurance? It depends on your situation, but here are some key factors to consider:
- Experts suggest buying in your 50s or early 60s. Because long-term care insurance premiums cost less at that age and you’re likely in better health. While you would pay premiums for more years, the total lifetime cost may still be lower.
- Buying earlier, like in your 40s, can work too. Premiums are likely to be even lower and you’d lock in coverage and your good health. But you’d pay for a longer period before needing it.
- Waiting until your late 60s might make sense if you’re healthy and have sufficient savings. But premiums are much higher, and health issues may arise that make coverage harder to qualify for. And discounts may no longer be available. If you become ill before purchasing coverage, you would be responsible for all long-term care costs.
One of our licensed long-term care professionals can pre-qualify any health concerns and provide you with quote comparisons.
Types of LTC insurance: Which is best for your situation?
Traditional Long-Term Care Insurance
- Design: Specifically designed to cover long-term care expenses, such as in-home care, assisted living, or nursing home care. Provides the most comprehensive long-term care benefits for your dollar.
- Benefits: The broadest set of options & benefits. Provides a daily or monthly benefit for a set period or the policyholder’s lifetime, depending on the policy terms.
- Premiums: Recurring premiums paid monthly, quarterly, or annually. Possibility of premium increases over time.
- Underwriting: Requires medical underwriting, where health status impacts eligibility and premium costs.
- Tax Advantages: Premiums may be tax-deductible, and benefits are generally tax-free.
- About Traditional Long-Term Care Insurance >
Life Insurance with Long-Term Care Rider
- Design: Combines permanent life insurance with a rider allowing access to benefits you can use for long-term healthcare. If care is not needed, your asset passes to your estate as a tax-free death benefit.
- Benefits: May build cash value and have a Return of Premium option
- Premiums: Premiums will NOT increase. Cost is higher than standard life insurance due to the added rider, but often more cost-effective than separate policies.
- Underwriting: Medical underwriting is usually less strict than traditional long-term care insurance.
- Tax Advantages: 1035 exchanges are possible and can be funded with qualified dollars (IRA, 401k, etc.)
- About Life Insurance with Long-Term Care >
Annuity with Long-Term Care Rider
- Design: A deferred annuity contract with a rider to cover long-term care expenses. Includes a fixed interest rate and possible indexing for asset growth
- Benefits: Long-term care benefits are usually double or triple the value of the annuity. If not exhausted paying for long-term healthcare, the annuity will transfer to your estate at time of death.
- Premiums: No premium increases. Can be purchased using a single premiums payment.
- Underwriting: Health underwriting is simpler than the other plans available.
- Tax Advantages: Tax-Free 1035 exchanges are possible from an existing annuity to a long-term care annuity.
- Long-Term Care Annuity Details >
How Much Does LTC Insurance Cost?
Long-term care insurance costs range from $1,500 to $5,000+ annually, depending on your age, health, and coverage choices. Most people pay between $2,000 – $3,000 per year for comprehensive coverage.
Several factors influence your premium:
- Age at purchase: Buying at 55 vs 65 can save thousands over time
- Current health status: Better health means lower rates
- Daily or monthly benefit amount: Typically $100 to $300 per day
- Total coverage limit: Usually $100,000 to $500,000+
- Elimination period: 30, 60, or 90-day waiting period before benefits start
- Inflation protection: Protects against rising care costs
Work With A Long-Term Care Specialist
We’ll guide you through the process of choosing between the best plans and companies.
Because premiums and health underwriting criteria can vary substantially between companies, we represent all major insurance carriers.
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About the Author: Craig Matesky
Reviewed by: Mike Berger