Long-term care insurance (LTCI) is a contractual arrangement that pays a selected dollar amount per day for a selected period of time for skilled, intermediate, or custodial care in nursing homes and other settings (such as home health care). Below is a list of items to think twice about when buying a long-term care insurance policy.
Non-Tax-Qualified Policies
Tax-qualified policies provide tax benefits. Moreover, certain minimum standards are required of tax-qualified policies.
Gatekeepers (e.g., a hospital admission) Prior to a Claim for Benefits
Gatekeepers make it more difficult to claim benefits.
Claims-Made Policies
A policy is issued now, but your application is evaluated at claim time—when you can be denied coverage.
Care Facility Restrictions
These provisions limit care to home care or nursing home care, rather than including all types of facilities.
Pre-Existing Condition Exclusions
These exclusions limit care for a specified period of time for medical conditions that exist before the purchase of the policy.
Mental or Emotional Disorder Exclusions
These exclusions deny claims for illness without an organic disease, except for Alzheimer’s disease.
Requirement that More than Two Activities of Daily Living (ADLs) Can’t be Performed Before You Qualify for Benefits
Inability to perform just two ADLs means that benefits from the policy are probably needed.
Insurance Companies that Are Poorly Rated, or Companies that Generate Excessive Consumer Complaints
When the benefits of the policy are needed, you want to make sure that they are available. Research ratings services and call your state’s insurance division before you buy your policy.
If you have questions, contact the Insurance Experts at Henssler Financial: experts@henssler.com or 770-429-9166.
Disclosures
The following information is reprinted with permission from Forefield, a division of Broadridge Financial Solutions, Inc. This article is meant to provide valuable background information on particular investments, NOT a recommendation to buy. The investments referenced within this article may currently be traded by Henssler Financial. All material presented is compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. The contents are intended for general information purposes only. Information provided should not be the sole basis in making any decisions and is not intended to replace the advice of a qualified professional, such as a tax consultant, insurance adviser or attorney. Although this material is designed to provide accurate and authoritative information with respect to the subject matter, it may not apply in all situations. Readers are urged to consult with their adviser concerning specific situations and questions. This is not to be construed as an offer to buy or sell any financial instruments. It is not our intention to state, indicate or imply in any manner that current or past results are indicative of future profitability or expectations. As with all investments, there are associated inherent risks. Please obtain and review all financial material carefully before investing. Henssler is not licensed to offer or sell insurance products, and this overview is not to be construed as an offer to purchase any insurance products.
