Long-Term Care insurance is a health-qualifying type of insurance. You must be in reasonably good health in order to obtain coverage. If your health is not good enough to qualify for coverage, no amount of premium you are willing to pay will change the fact that you’re ineligible. As with all types of insurance, many times those who want coverage the most are those who can’t qualify for it.
If you decide to apply for coverage, you will go through a process called underwriting. Underwriting is defined as “a process of examining, accepting, or rejecting insurance risks, and then classifying those accepted in order to charge the proper amount of premium.”
The LTC insurance underwriting process consists of answering questions about your health, and may also include a physical exam and/or request for medical information from your doctor.
If you currently have certain health conditions, you will automatically be ineligible to apply for LTC insurance. Some of these conditions are ones that you would expect: Parkinson’s Disease, Alzheimer’s Disease, and Multiple Strokes. Others, such as Schizophrenia may not be as obvious.
In addition to the conditions mentioned above, here are some other disqualifying conditions:
- Renal Failure
- Congestive Heart Failure
- Cirrhosis of the liver
- Diabetes with Complications
- Mental Retardation
- Severe Emphysema
- Transient Ischemic Attack
In addition to these conditions, you must not have needed any of the following during the preceding 12 months:
- Assistance with activities of daily living (bathing, eating, dressing)
- Home Health Care Services
- Care in a nursing home or assisted living facility
- A walker, wheelchair, medical appliance, kidney dialysis, manufactured source of oxygen
But even if you don’t have any of the disqualifying conditions, it doesn’t mean that you will automatically qualify for coverage. Underwriting is performed on an individual basis, and there may be other conditions, or combinations of conditions, that cause an application to be declined. For example, if you have high blood pressure that is controlled with medications, but you’re significantly over weight, your application will probably be denied.
The LTC insurance industry is experiencing a trend toward more stringent underwriting. As new health information is released, insurance companies gain more insight into the reasons people need long-term care. For example, a recent study suggests that people who have diabetes and high blood pressure may be at greater risk for developing memory loss.
Keep in mind that this discussion is limited strictly to your current health. If you develop a health condition after your LTC insurance policy is issued, the company cannot cancel your policy or deny a claim due to the newly developed condition.