New York Estate Planning & Elder Law Blog
Over the last few years, Covid-19 has caused many people to think deeply about health issues. Now that the height of the pandemic has passed, many people are left wondering how this has impacted long-term care insurance.
A noticeable increase in long-term care insurance has occurred following the summer of 2020 as reported by many medical experts. Many people who previously rejected long-term care coverage have since changed their opinions.
What Is Long-Term Care Insurance?
Long-term care insurance reimburses policyholders a fixed amount for services to help them with activities including daily living tasks like those associated with personal hygiene. An applicant can choose various care options and benefits that let them obtain the care they deserve.
The Covid-19 Impacted Obtaining Long -term Care Insurance
No data yet exists about the impact these changes will have on the healthcare industry, but the
covid-19 pandemic made it harder for people to pass the underwriting requirements. Some insurers have increased the list of pre-existing conditions that will disqualify applicants.
People from various regions were also refused coverage. Insurance carriers look very closely at
applicants coming from various parts of the country with high Covid-19 rates. In many situations, applications are declined in addition to those from individuals who have traveled to certain countries.
Increase in Medical Exams
This increased scrutiny resulted in more in-person medical exams, though. One medical professional states that long-term care providers have needed to better assess the risk related to new applicants. Many carriers included new questions in their applications addressing comorbidities, Covid-19 exposure, and travel to foreign countries. Each of the factors that play a role in applications for long-term care insurance has declined.
Simultaneously, age restrictions on these policies were heightened. Older applicants always require more heightened reviews to qualify for coverage, but these regulations became less forgiving during the Covid-19 pandemic.
Minimum Age Reduced for Long-Term Care Applicants
When states issued stay-at-home orders and insurance carriers could no longer perform in-person exams, many insurance carriers lowered the maximum age for long-term care insurance applicants. Some carriers momentarily stopped accepting applications from individuals in their late 60s, while a few carriers lowered the maximum age to 65.
Nationwide as well as other large insurance carriers do not offer stand-alone long-term care policies, but do have various long-term care insurance riders and other associated benefits that provide both life and long-term care coverage. The maximum issue age was reduced to 70 even though carriers argue this has more to do with low-interest rates than Covid.
Additionally, many insurance carriers placed a waiting period on coverage, particularly if a client ever tests positive for Covid-19. The waiting period if a person tests positive is 90 days. If a person is hospitalized with the disease, the individual is subject to a six-month waiting period.