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If you decide that you want
to consider long term care insurance what should you look for? And how old should you be
before you begin coverage? Let's see if we can't shed some light on the subject.
Find an Agent
We'll begin by finding a good insurance agent. Select your agent carefully. For most
buyers this is an area where they have very little knowledge. That means you'll be relying
on your agent for advice on which policy and coverage level to buy. You'll also want an
agent who can work directly with the home office to help present your medical history in
the best possible light. That can be important since many companies will exclude
pre-existing conditions like Alzheimer's or heart disease. If your medical history is bad,
they could turn you down altogether.
Compare Policies
After you've found a good agent it's time to compare policies. Remember that policy
benefits don't actually "pay for" medical or nursing home bills. The policy will
pay a predetermined amount if you meet certain conditions or incur certain expenses (like
being in a hospital or nursing home). But your benefit can be less than or more than the
actual cost of the service covered. The amount of the bill does not determine the amount
of the check you'll receive.
When comparing policies you'll want to ask a number of questions. First, find out whether
it covers care provided in the hospital, in a nursing home or in your own home. Don't
assume that it will cover all three. How long will you wait before the policy begins to
pay? That's called 'the elimination period'.
What exclusions are in the policy? Does it exclude certain causes (diseases) that are part
of your personal or family history? How long will skilled or intermediate care be covered?
Will the policy pay as long as you live? Or is there a maximum benefit?
Will the benefits be adjusted for inflation? What about premiums? Can they be increased?
And, if so, how often and by how much?
It is important to read the policy and ask questions of a qualified agent on portions that
you don't understand. Don't expect to understand every paragraph in the policy. Even if
you work in the medical or insurance industries you'll have some questions. Even the agent
may not be able to answer every question.
You also need to remember that there are no refunds if you don't use the policy. And, for
you baby boomers, you can't buy a policy for your parents. You can help pay for the
policy, but the covered person needs to apply
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