Enhancements to Long-Term Care Insurance
LTC policies have improved slightly in recent years in response to consumer pressure, embarrassing media exposure, and increased competition from new insurers entering the market.
Clearer terms and conditions, for example, give consumers a better idea of what to expect for their money. Many policies now include some types of assisted living residences as well as regular nursing facilities.
Several policies allow seniors to use a pool of benefit funds for either home care or residential long-term care, rather than just one. Requirements to qualify for benefits have also been relaxed slightly, and policies now routinely allow the policyholder to “step down” to lower levels of coverage for a lower premium if continuing to pay for the higher benefits becomes financially burdensome.
What to Look for in Long-Term Care Insurance
If you decide that LTC insurance is right for you, research your options thoroughly. In particular, inquire about: Is it comprehensive enough to cover the various types of care you may require? Does it cover at-home care and assisted living as well as nursing facilities?
What is the amount of the benefit?
Benefits can range from $50 to $500 per day, depending on whether you require care in a nursing home or at home.
What types of inflation protection are available? LTC policies frequently do not pay out for decades, so getting inflation protection, which adjusts the benefit amount to account for inflation, is critical.
How long will the coverage last?
Almost all policies provide benefits for a limited time, such as two or three years of long-term care.
What causes the benefits to occur?
Most policies require a physician’s certification that you have lost the ability to perform a certain number of ADLs (activities of daily living), such as bathing, eating, dressing, toileting, getting in and out of bed or a chair, taking medication, and maintaining continence. Some policies are more restrictive than others, and the manner in which benefits are triggered can have a significant impact on when you can start receiving benefits.
What is the period of elimination (waiting)?
Even if you qualify for benefits, most policies require you to wait for a certain period of time before filing a claim.