What to do if your Long Term Care insurance coverage is rejected

Long term care insurance is becoming a tougher call by the day. Some policyholders have tried to purchase coverage only to realize that their applications to be declined. It’s advisable to purchase LTC insurance while in your mid-50s. The younger you are when you purchase long term care coverage, the lower the chances that your application will be rejected.

However, if you just applied and your application was rejected, where do you find help?

1.       Consult a bad faith claims attorney

You should consider consulting an experienced attorney who specializes in bad faith claims for advice. An attorney can be able to help you in case your LTC insurer has wrongly declined your claim and you may want legal action to be taken.

The complaint should be addressed to your state’s insurance commissioner. These commissioners are found in all states. They supervise the insurers licensed to run in the states. A complaint may lead to the state communicating with the insurer on your behalf and may result in some good help but you can never be sure that this option will work.

2.       Keep shopping for another policy

If an Insurance agent helped you purchase the LTC insurance, there is a possibility that they only gave you proprietary policies. This means that your capability to qualify for a policy may have been narrowed down to purchase through a single company.

It’s always recommended to work with a financial advisor or a long-term care insurance agent who is independent and can hook you up to more options in the marketplace. There is a possibility that your health might be in good enough shape to qualify for a policy from another company.

3.       Try a hybrid policy

You may also consider trying out a hybrid policy that contains both LTC and life insurance. This policy includes a death benefit that can have its face value changed into LTC cover. This means that if in case LTC is needed the medical expenses are taken care of, and the death benefit reduces accordingly. If any LTC will not be needed the full death benefits will be received by the beneficiaries.

4.       Re-apply again in a few years

There is a possibility your LTC coverage was declined because of health issues you experienced recently. If you recover it may mean that in future you might be qualified for coverage. It’s not unusual some policyholders become eligible to shop for LTC insurance after their health improves.

5.       Take precautions

Before submitting an application for LTC with a different insurance company, take you time to find out why you were denied coverage by the first company. This essentially helps you identify any mistakes you might have made so you can avoid doing the same in a subsequent application. One of the reasons why some otherwise qualified people are denied LTC insurance coverage is because they provide wrongful information.

6.       Your application shouldn’t be kept pending

Majority of states have their own time limits on applications for LTC insurance. It’s the duty of insurance companies to reply to an applicant within that time limit. They should accept the risk, deny the risk totally or make a counter offer. They should not keep any application pending for future reference.

But what if your application is denied by all carriers? If that’s the case, your long term care insurance agent should be able to tell you why. In this case you might have no other option but to try out other ways to insure yourself against the devastating costs of care.

Buying a long-term insurance is one of the ways to prepare for long term care expenses. If you can’t be able to purchase a policy, alternative options include transferring certain assets and estate planning. Indeed, everyone should consider alternative LTC insurance options whether or not they are quailed for coverage.