Companies that sell long term care insurance medically “underwrite” their coverage. They look at your health and health history before they decide to issue a policy. You may be able to buy coverage through an employer or another type of group without any health underwriting or with more relaxed underwriting. Insurance companies’ underwriting practices affect the premiums they charge you now and in the future. Some companies do what is known as “short-form” underwriting. They ask
you to answer a few questions on the insurance application about your health. For example, they may want to know if you have been in a nursing home or received care at home in the last 12 months.
Sometimes companies don’t check your medical record until you file a claim. Then they may try to refuse to pay you benefits because of information
found in your medical record after you file your claim. This practice is called “post-claims underwriting.” It is illegal in many states. Companies that thoroughly check your health before selling you a policy aren’t as
likely to do post-claims underwriting.
Some companies do more underwriting. They may ask more questions, look at your current medical records, and ask your doctor for a statement about your health. These companies may insure fewer people with health problems. If you have certain conditions that are likely to mean you’ll soon need long-term care (Parkinson’s disease, for example), you probably cannot buy coverage from these companies.
No matter how the company underwrites, you must answer certain questions that the company uses to decide if it will insure you. When you fill out your application, be sure to answer all questions correctly and completely. A company depends on the information you put on your application. If the information is wrong, an insurance company may decide to rescind your policy and return the premiums you have paid. It can usually do this within two years after you buy the policy. Most states require the insurance company to give you a copy of your application when it delivers the policy. At this time, you can review your answers again. You should keep this copy of the application with your insurance papers.
What Happens If You Have Pre-Existing Conditions?
A long term care insurance policy usually defines a pre-existing condition as one for which you received medical advice or treatment or had symptoms of within a certain period before you applied for the policy. Some companies look further back in time than others. That may be important to you if you have a pre-existing condition. A company that learns you didn’t tell it about a pre-existing condition on your application might not pay for treatment related to that condition and might even cancel your coverage. A company can usually do this within two years after you buy the policy, or in some cases later, if you intentionally mislead the insurer.
Many companies will sell a policy to someone with a pre-existing condition. However, the company may not pay benefits for long-term care related to that condition for a period after the policy goes into effect, usually six months. Some companies have longer pre-existing condition periods; others have none