How to Apply for Long Term Care Insurance
Find out if your employer offers a policy., Decide the level and type of coverage you need., Assess your finances., Evaluate different providers., Get quotes., Choose your policy.
Step-by-Step Guide
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Step 1: Find out if your employer offers a policy.
Some employers offer long-term care insurance at group rates.
Employer-sponsored plans typically have lower rates than individual policies, and you may not have to meet the same medical requirements you would if you purchased an individual policy.Long-term care insurance also may be available through a professional or service organization to which you belong. -
Step 2: Decide the level and type of coverage you need.
Although it may be difficult to determine if you're looking for a policy decades before you anticipate needing it, you need to look at the types of long-term care available in your area and which you prefer.
Consider the support you may have from your family and friends.
If you can reasonably expect significant assistance from them, you may require lesser levels of coverage.The level of coverage for which you are eligible may depend on whether you have any pre-existing conditions that would increase the likelihood that you need long-term care later in life.Keep in mind that long-term care can cost between $200 and $300 for a private room in a nursing home or assisted living facility, and at least $20 per hour for in-home care., Your finances will affect not only the premiums you can afford but also the amount of benefit you'll need and how soon it will take effect after you require long-term care.Keep in mind that premiums often increase over time, and your income may decrease as you get older.
If you have to drop your policy because you can no longer afford the premiums, you will lose the benefits it offers as well as all the money you've already paid into it.You may want to speak with a lawyer or financial advisor about your retirement savings and other ways to cover future long-term care expenses before you choose to apply for long-term care insurance., Once you have a good idea of the type of policy you need, you should research companies that offer those types of policies.
Insurance agencies should be licensed to sell insurance in your state, and the agent with whom you work should have additional training and experience in long-term care insurance.You can check with your state's insurance department to find out the status of a particular provider's license and whether any complaints have been filed against them.You also might check consumer boards and organizations such as the Better Business Bureau to assess the company's reputation.
You also should review the overall stability of the company and its history with long-term care insurance.You don't want to purchase a long-term care insurance policy with a company that has a significant risk of going belly-up.
Keep in mind that some companies may require you to use certain services or health-care providers rather than giving you a choice.
Having a good understanding of the types of long-term care with which you would be comfortable can help you narrow down the policies offered by various companies.For example, one company may not cover in-home long-term care.
If you know that you would prefer to stay in your home rather than being moved to a nursing home or assisted living facility, you should make sure in-home care will be covered by the policies you consider buying.
If the insurance company requires use only of particular services or long-term care companies, you also should make sure that company operates in the area where you live.Understanding that your premium may increase over time, you can ask each company to provide information regarding the rate history for its premiums, or look into anti-inflation protection for your policy., When you're ready to buy your policy, you should get quotes from at least three reputable insurers so you can pick the one that best suits your needs and your budget.
The company may provide an informal review before offering you a quote, to determine if you are eligible for the policies it offers.Make sure you get a written copy of the policy so you can review it carefully.
If there are any terms you don't understand, you might consider discussing it with an attorney or financial advisor.To determine how useful a policy will be to you, compare the amount of the benefits to your financial projections regarding the money you'll have available to cover long-term care as well as familial or other support you have.You also should compare the offered benefits to the average cost of care in your area.If the policy won't cover care for you, it won't be of much value for you to pay into it.
When you're choosing among policies, look at how each one defines the events that trigger when you become eligible for benefits.
Generally, you qualify for benefits when you cannot complete two or three basic activities of daily life such as bathing, eating, or using the toilet without assistance.
However, some insurance companies require you to be physically unable to complete those activities, rather than have mental difficulties due to an illness such as Alzheimer's disease.Check whether the policy has a nonforfeiture provision.
This provision allows you to receive a lesser benefit amount even if you can no longer afford the premiums, based on how long you have paid into the policy.
These provisions are required in some states but not everywhere.When evaluating possible policies, make sure you understand each policy's waiting or elimination period, the daily benefits that will be provided, what must happen to trigger benefits, and what conditions are excluded., Once you've decided which policy you want to buy, it's typically just a matter of signing some paperwork and paying your premium.
Typically even after you've signed your policy you have a period of 30 days or so during which you can review your policy and return it for a full refund with no questions asked if you change your mind about your purchase or decide to go with another company.Average long-term care insurance policies in the U.S. cost between $2,000 and $3,000 a year.
That amount purchases a comprehensive policy that covers both in-home and facility care for around five years, paying between $100 and $200 a day.Make sure you pay your premiums when due or you risk losing your policy and any benefits in which you've invested.
You typically have the ability to choose the waiting or elimination period for your policy.
This period begins when you need long-term care.
Think of this period as similar to a deductible on your auto insurance policy – the shorter the waiting period, the higher your premiums will be. -
Step 3: Assess your finances.
-
Step 4: Evaluate different providers.
-
Step 5: Get quotes.
-
Step 6: Choose your policy.
Detailed Guide
Some employers offer long-term care insurance at group rates.
Employer-sponsored plans typically have lower rates than individual policies, and you may not have to meet the same medical requirements you would if you purchased an individual policy.Long-term care insurance also may be available through a professional or service organization to which you belong.
Although it may be difficult to determine if you're looking for a policy decades before you anticipate needing it, you need to look at the types of long-term care available in your area and which you prefer.
Consider the support you may have from your family and friends.
If you can reasonably expect significant assistance from them, you may require lesser levels of coverage.The level of coverage for which you are eligible may depend on whether you have any pre-existing conditions that would increase the likelihood that you need long-term care later in life.Keep in mind that long-term care can cost between $200 and $300 for a private room in a nursing home or assisted living facility, and at least $20 per hour for in-home care., Your finances will affect not only the premiums you can afford but also the amount of benefit you'll need and how soon it will take effect after you require long-term care.Keep in mind that premiums often increase over time, and your income may decrease as you get older.
If you have to drop your policy because you can no longer afford the premiums, you will lose the benefits it offers as well as all the money you've already paid into it.You may want to speak with a lawyer or financial advisor about your retirement savings and other ways to cover future long-term care expenses before you choose to apply for long-term care insurance., Once you have a good idea of the type of policy you need, you should research companies that offer those types of policies.
Insurance agencies should be licensed to sell insurance in your state, and the agent with whom you work should have additional training and experience in long-term care insurance.You can check with your state's insurance department to find out the status of a particular provider's license and whether any complaints have been filed against them.You also might check consumer boards and organizations such as the Better Business Bureau to assess the company's reputation.
You also should review the overall stability of the company and its history with long-term care insurance.You don't want to purchase a long-term care insurance policy with a company that has a significant risk of going belly-up.
Keep in mind that some companies may require you to use certain services or health-care providers rather than giving you a choice.
Having a good understanding of the types of long-term care with which you would be comfortable can help you narrow down the policies offered by various companies.For example, one company may not cover in-home long-term care.
If you know that you would prefer to stay in your home rather than being moved to a nursing home or assisted living facility, you should make sure in-home care will be covered by the policies you consider buying.
If the insurance company requires use only of particular services or long-term care companies, you also should make sure that company operates in the area where you live.Understanding that your premium may increase over time, you can ask each company to provide information regarding the rate history for its premiums, or look into anti-inflation protection for your policy., When you're ready to buy your policy, you should get quotes from at least three reputable insurers so you can pick the one that best suits your needs and your budget.
The company may provide an informal review before offering you a quote, to determine if you are eligible for the policies it offers.Make sure you get a written copy of the policy so you can review it carefully.
If there are any terms you don't understand, you might consider discussing it with an attorney or financial advisor.To determine how useful a policy will be to you, compare the amount of the benefits to your financial projections regarding the money you'll have available to cover long-term care as well as familial or other support you have.You also should compare the offered benefits to the average cost of care in your area.If the policy won't cover care for you, it won't be of much value for you to pay into it.
When you're choosing among policies, look at how each one defines the events that trigger when you become eligible for benefits.
Generally, you qualify for benefits when you cannot complete two or three basic activities of daily life such as bathing, eating, or using the toilet without assistance.
However, some insurance companies require you to be physically unable to complete those activities, rather than have mental difficulties due to an illness such as Alzheimer's disease.Check whether the policy has a nonforfeiture provision.
This provision allows you to receive a lesser benefit amount even if you can no longer afford the premiums, based on how long you have paid into the policy.
These provisions are required in some states but not everywhere.When evaluating possible policies, make sure you understand each policy's waiting or elimination period, the daily benefits that will be provided, what must happen to trigger benefits, and what conditions are excluded., Once you've decided which policy you want to buy, it's typically just a matter of signing some paperwork and paying your premium.
Typically even after you've signed your policy you have a period of 30 days or so during which you can review your policy and return it for a full refund with no questions asked if you change your mind about your purchase or decide to go with another company.Average long-term care insurance policies in the U.S. cost between $2,000 and $3,000 a year.
That amount purchases a comprehensive policy that covers both in-home and facility care for around five years, paying between $100 and $200 a day.Make sure you pay your premiums when due or you risk losing your policy and any benefits in which you've invested.
You typically have the ability to choose the waiting or elimination period for your policy.
This period begins when you need long-term care.
Think of this period as similar to a deductible on your auto insurance policy – the shorter the waiting period, the higher your premiums will be.
About the Author
Janet Ramos
Professional writer focused on creating easy-to-follow crafts tutorials.
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