Shopping for LTCI

When you are shopping for long term care insurance, it is extremely important to check exactly how much the various policies actually cover and what the terms and conditions are. The long term care insurance business isn’t standardized so you can never assume that a policy will cover certain things, not even if these things are really basic tings that pretty much anyone requiring long term care would need.

Here are just a few examples of things that you should check out when you are in the process of selecting long term care insurance.

Nursing home only?

ltci premiumSome policies are pretty limited and will only cover basic nursing home long-term care. Once upon a time, this was pretty much the only professional long-term care available to the average person, and this is still reflected in some policies.

However, you might want to broaden your options when you purchase a LTCI policy today, since there are so many forms of long-term care available nowadays. There is for instance specialized facilities for Alzheimer patients, and they tend to be a better option than the standard nursing home for someone who needs help due to Alzheimer or similar dementia and not because of serious mobility impairment.

The assisted living facility is another interesting option, a type of group home created to cater to those who need help in their everyday life but are still more independent than the standard nursing-home resident.

If you think that you would prefer to stay in your home as long as possible, a LTCI policy that covers comprehensive home care becomes important. You may also want to check the cover for adult day care and/or respite care.

Is the benefit period limited?

Some LTCI policies are unlimited and will pay for long-term care as long as you need it, and keep you covered until you die as long as you fulfill the requirements.

Other policies are limited. They may for instance only pay for a certain number of days of long-term care (e.g. a maximum of 1095 days), or they may keep you covered only for a designated part of your life (e.g. only until you reach the age of 85 years).

How big is the maximum daily benefit?

Most policies will have a cap for how much money they will pay per day when you receive long-term care. The care you can get for $85 a day is not the same as the one that is available to those who can afford to pay $285 a day, so this is an important point to consider.

How long is the waiting period?

ltci moneyYou can usually get the premium down by accepting a longer waiting period, but this means that you will have to wait longer for the insurance policy to start paying out when you are in need of long term care. Examples of commonly available waiting periods are 30 days, 60 days, 90 days, and 120 days.

Is there a deductible?

Some LTCI policies have a deductible. Accepting a high deductible usually means paying a lower premium for the policy, but it also means that you need to have money set aside to pay for the deductible should you ever need long term care.

Don’t forget about the other parts of the puzzle

Long term care is only one piece of the puzzle. If you are in a situation where you require long term care, you probably also have some substantial expenses to cover for medicine, doctor appointments, and so on. It is therefore important to know beforehand how wide your LTCI policy is, and which expenses that you need to have other insurance protection for.

It is also important to understand how relying on insurance will limit your ability to chose freely. Let’s for instance say that you prefer a special brand of a blood pressure medication. Will this insurance policy pay for that medicine, or will it only pay for a cheaper generic version from another manufacturer? If you need corrective lenses, will you be able to have them ordered from an international site where you can find a multitude of brands, or will the insurance company only allow you to select from a few lens manufacturers that are well-known in your specific country? Or maybe force you to switch from lenses to glasses, even though you really prefer to use lenses? Just because we need long term care it doesn’t mean that we lose all our personal preferences.

Deciding which long term care insurance policy you want should always go hand in hand with assessing your other insurance needs, and also preferably include a discussion about how much you need in cash reserves (or easily liquidated assets) in order to retain your freedom of choice in situations where relying on the insurance company to pay would force you to pick something else than what you actually want.