LTCI Explained~Long Term Care Insurance (LTCI) Basics~The Definition Of LTCI (Long Term Care Insurance)
Private insurance companies sell LTCI policies to offset the costs of long-term care. LTCI, like all insurance policies, requires premiums to help recipients avoid paying large sums later on in the event of an illness or a catastrophic event. Premiums are based on the individual’s age at the time of purchase and are usually locked in for the life of the policy. LTCI covers the following, depending on the policy you choose:
Care in a skilled nursing facility
Care in an assisted living facility
Buying a LTCI policy gives the policy holder to select from the many options, such as the amount of the daily benefit, the number of years the policy will pay benefits, and, once the applicant qualifies for a policy, the number of days or months before the policy will begin paying benefits. It is imperative to evaluate policies with scrutiny in order to see which one offers the benefits that you are looking for with a premium that fits your budget. Policies differ in their benefits, contract conditions, deductibles and premiums.
It is also a matter of great importance to take into account the rising expense of home care. Be sure the LTCI policy gives inflation protection for benefits to increase as health care costs continue to rise. Policies are generally labeled according to the place in which benefits are paid. Remember that home care only policies only pay for care at home and in an adult day care or adult day health care facilities. Make sure the policy includes both types of day care. Facility-only policies pay for care in a skilled nursing facility and in an assisted living facility. Comprehensive policies pay for care in a skilled nursing facility, assisted living facility, adult day care or adult day health care facility, and at home. Since the LTCI claims are always paid within many years after the purchase of the policy, it is imperative to check the following: Financial strength of the company. The industry’s major rating services are A.M. Best , Duff and Phelps, Moody’s, Standard and Poor’s and Weiss Ratings . Reputation and claims-paying history of the company.
You can contact the State Insurance Department for more information on specific private insurance companies. Click here for listings information for each state’s insurance information. Applicant must be healthy at the time of application Each insurance company has individual requirements and/or limitations Not sure when is the right time to buy an LTCI policy? Or how to assess what you will need from a policy? Visit our Expert Column on Financing Long Term Care to find out more.
Tags: adult day care, long term care, long term care insurance