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Long-term care policies can be purchased through private insurance companies, an insurance agent or possibly through your employer. When deciding where to purchase your long-term care policy, make sure you have shopped around to find the coverage that will best fit your needs.
- Individual —
Policies sold to individuals can offer a
different combination of benefits from one
company to the next.
- Group — Your employer may offer a long-term care group insurance plan, or you may be eligible for the Federal Long Term Care Insurance Program (FLTCIP).
Each policy offers different advantages. Individual policies
generally offer more options and flexibility than group policies.
Also, some individual policies may offer significant discounts
for spouses and families.
Depending on your health, they can also be less expensive
than group policies. However, group policies are advantageous
in that you may not have to meet certain medical requirements
to get a policy during an enrollment period. As with individual
policies, your spouse, parents and in-laws may apply for this
coverage as well. Also, in some cases, group policies may
continue coverage even after your employment ends. So
remember to do your research before you buy to find an
individual or group policy that will best cover your needs.
- Association —
The policies offered through professional or
trade organizations usually give their members a
choice of benefit options with negotiated
premium discounts.
- Partnership Programs —
These are specific state-approved policies
designed to provide full or partial protection
against the normal Medicaid requirements. The
program helps cover long-term care costs without
having to spend-down life savings.
- Pooled Benefits
— This policy combines the benefits of two separate policies into one policy two individual can share. The coverage is the same as a non-pooled policy except that the combined policy limits are available for either individual or both to draw upon
Tax-Qualified Policies
A tax-qualified long-term care insurance policy offers certain federal income tax advantages. The benefits paid by a tax-qualified policy are generally not taxed as income for federal income tax purposes.
Non-Tax-Qualified Policies
A non-tax-qualified long-term care insurance policy offers fewer restrictions on the eligibility of benefits. Benefits from a non-tax-qualified policy may be taxed as income for federal income tax purposes.
Whichever policy you choose, make sure the benefits will meet your needs.
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