How to pick solid long-term care insurance

Clark has long encouraged people in their late 50s and early 60s to consider buying long-term care (LTC) insurance, which pays for care in a nursing home, an assisted living facility or in your own home.

There's a misconception that Medicare will pay for this kind of care, but it won't. Medicaid, meanwhile, requires you to impoverish yourself before the government will pick up the tab for a nursing home. But what happens when you get better and suddenly you're broke? LTC insurance takes the worry out of the equation.

The industry, however, has been littered with fly-by-night operations and other unstable players. The latest blow comes from Conseco, which worked out a deal with Pennsylvania to dump its LTC obligations and essentially turn people over as wards of the state.

The solution is to only buy LTC insurance from a solid company, preferably one that has an A.M. Best rating of A++ or A+. It may cost you more now, but decades down the road you have a greater likelihood that A++ and A+ companies will be around.

One final note: LTC insurance isn't necessary if you're so wealthy that money is no object to getting the best care, or if you're so poor that being a ward of the state makes sense. That still leaves between 65% and 80% of Americans in the middle who could benefit from it.