Financial Information: Understanding Long Term Care Insurance

Health Status

All insurance companies ask questions regarding your current health status and you should fully disclose your medical conditions. Many companies will medically underwrite the policy by asking you to complete a medical history form and to supply the name of your physician. If you are denied a policy, ask the company why it refused to insure you and consider an appeal. (The policy should explain how to file a complaint, where to get information from your insurance company and how to appeal a claim denial).

Additional Pointers

• Most companies target their policies to people who are reasonably healthy and at a relatively low risk of needing long term care in the near future.
• A good company asks detailed medical questions up front.
• Some companies are reluctant to sell to a person over 85, or may sell only a lower benefit policy.
• Some companies require a waiting period of up to six months for preexisting conditions.

Policy Review & Change

You should review the actual policy before buying. Your agent should be willing to leave a sample policy for you to review. After you buy, you usually have the right to review the policy for 30 days with an option to cancel for a full refund.

There might also be situations in which canceling an existing policy to buy a new one makes sense. You should carefully compare the increased premiums to the added benefits of the new policy. Remember that your premium is based on your age at the time you initially purchase a policy. Insurance companies introduce new products every few years. Be sure to ask your agent about the company’s practices regarding policy upgrades.

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