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Abstract
With a third of the French population aged 60 or over by 2050, compared to a quarter today, the loss of independence has become a major source of concern both for institutional actors and individuals. The total cost of loss of independence was estimated at 30 billion Euros in 2014 (1.14 point of GDP). This amount could double as a share of GDP by 2060, obviously raising fears that the remaining cost may increase unreasonably for households in the coming decades. We use a computable general equilibrium model with overlapping generations to evaluate the implications that the implementation of mandatory long-term care insurance could have. This model offers a double advantage for carrying out this type of evaluation: (1) it informs us about the effects that the implementation of this insurance, particularly its financing, can have on macroeconomic aggregates; (2) integrating heterogeneity by age and qualification level of individuals, it also allows for a better understanding of the varied effects of benefits and the different financing modes of this long-term care insurance on different categories of people.