Long Term Care Insurance Definition And Conditions
Understanding What is Long Term Care Insurance
What is long term care insurance? LTC or LTCI, as it is recognized in the life insurance industry, is a health insurance product in Canada that offers money for the cost of long-term care demands. The long-term care insurance benefit is not integrated with any provincial financial assistance programs or provincial health care.
People who need long term care are usually not sick in the classic sense. They are unable to perform some of the 6 basic daily efforts of living, such as dressing, bathing, feeding yourself, toileting, continence and transferring (getting in and out of a bed or chair). Another frequent cause of long term care need is mental/cognitive impairment, caused by diseases such as Alzheimers.
Age is not a determining element in qualifying for a long term care insurance claim, but many of the diseases that can lead to LTC claims are age related. In Canada, about 50% of all people over the age of 65 will need intense long term care in their lifetime. Many of these people will turn to family to provide the in home care they require. It is only at the very serious stages of care need that Canadians are looked after by a provincial long term care facility with 24 hour nursing care.
How you can claim a long term care insurance policy
If you own long term care insurance, the determined by your doctor. There is an proper diagnosis of requiring assistance with any of the 6 daily activities of living which a doctor can diagnose. A long term care insurance claim is eligible once two or more of the 6 daily activities of living require assistance, or you have some type of mental/cognitive impairment that has become severe and needs long term care. Here are the 6 daily activities of living, as accepted by the Canadian Medical Association, the Canada Revenue Agency, and life insurance companies:
Dressing yourself
Feeding yourself
Bathing yourself
Toileting
Continence
Transferring (getting in and out of a bed or chair)
Any kind of dementia, such as Alzheimers, that has turn out to be severe, would also qualify for a claim on its own.
When to invest in long term care insurance
Most Canadians looking at long term care insurance would be suggested to look at obtaining the policy in their late 40s through early 60s. The younger you are the more affordable the premiums, plus you could actually plan to pay up the policy in 20 years and finished when entering retirement. After your early 60s the policy becomes very highly-priced and hard to fit into a fixed income budget.
Other significant factor is your health. Insurance companies are not apprehensive with the risk of you dying when setting up this type of insurance. They are concerned with the risk of your needing care. Early signs of dementia, osteoporosis, use of a cane or other mobility devises would all be major concerns to an insurance company issuing this sort of policy. When you are younger your health equipment should not be a obstacle to getting the policy. As you grow older there is a good possibility that regular health complications due to the aging process will make it extremely hard for you to qualify for long term care insurance.
How does long term care insurance work
Many Canadian insurance companies offering long term care insurance are modeling the plan on a daily or weekly benefit amount. For example, if you bought $100 per day, you could claim $36,500 of tax free health benefits for the price of your long term care every year. A $1,000 per week benefit would sort out to $52,000 of annual benefits.
Long term care insurance policies are split into two parst: Facility Care and Home Care. The Home Care benefit is optional to be added onto the mandatory Facility Care benefit. With only the facility care benefit you would not be capable to claim on your long term care insurance policy if you were receiving care at home, even if it was from a professional home-care nursing company. By including the home care rider to your long term care insurance policy you will receive benefits in both a long term care facility or in the comfort of your own home.
You can also buy a certain length of benefits or an unlimited policy. Benefits could be for as little as 2 years, 5 years, 10 years or unlimited. The unlimited policy is obviously the most costly because the insurance company might have to pay benefits for many years.
The long term care insurance benefit is paid out either as a direct deposit into the insureds bank account (accessible by the individual or their power of attorney taking care of their care needs) or it is paid as a reimbursement of eligible medical expenses. Some Canadian insurance companies make payments straight to the insureds bank account while others require claim forms to be filled out and reimbursements to be paid back to the insured. Be sure to consult your insurance broker which type of policy it is and how claims will be paid.
There are other riders that can be included to the policy, like inflation protection and return of premium at death if you never used the policy. You will have to examine the cost of these riders and verify if the benefit is sufficient for the increased price.
The need for long term care insurance
There are several reasons why you might need long term care insurance. It provides a tax free health insurance benefit to help you pay for the excessive cost of care. Here are a few steps you might use the proceeds of a long term care insurance policy:
Pay for specialized nursing and home care in your own home
Reimburse family for lost income and expenses who are helping to take care of you
Pay the expensive cost of a private or semi-private long term care facility
Pay for additional/optional services in a government operate long term care facility
What is Long Term Care Insurance Learn more from Life Guard Insurance
If you are interested in planning for your care needs, making sure you have the quality of care and the dignity of life you want in your old age, a long term care insurance plan might be ideal for you. Don't hesitate to contact Life Guard Insurance to answer the question what is long term care insurance for your unique care needs.
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