Choosing the Right Long Term Care Insurance Company
When shopping for LTC coverage, don’t make the mistake of overlooking the carrier rating. Too many individuals become so focused on the policy and premiums, that they forget that choosing the right insurance carrier is also an important decision.
Your LTCI purchase decision should not be on the cost of the policy alone. Consider if your insurer will pay when you need care and if they will still be in business when the need for your long term care arises. Also consider if the LTCI company had rate increases in the past or if the LTCI rates have been stable.
Financial Strength and Size of LTCI Companies
The average age that most people will need LTC insurance is 78. If you purchase LTCI when you are 55, you may not need to make claims for another 23 years. You will want to pick a LTC company that is financially strong enough and large enough to be around for 23 years from now. Consumers can check LTCI company rating and financial size online including:
Insurance Rate Stability
LTCI companies cannot increase your individual premium for changes in your age or health. However, companies can file a rate increase for a class of policyholders or all policy holders on a specific contract form in any given state.
Insurance companies usually want to keep consumer confidence by keeping rates stable. Companies with high claim loss may be more likely to need future rate increases. To get an idea of LTCI companies’ claim loss, read the NAIC’s annual “Long Term Care Experience Report” which shows actual claims loss ratios. Consumers can also inquire if the company has had any previous rate increases.