Short-Term Care Insurance: What Is it and Why Is it a Good Thing?

You may hear us talk a lot about Long-Term Care Insurance, including how it’s an important part of retirement planning. But the reality is, not everyone can qualify for or afford a long-term care policy. That’s where Short-Term Care Insurance comes in.

What Is Short-Term Care Insurance?

Short-Term Care Insurance is an alternative, affordable option compared to long-term care coverage. It protects a policyholder’s income and assets against the threat of a care event, but for a shorter period (typically up to one year).

Short-term care policies have lower premiums and looser underwriting standards than long-term care policies. This makes them more accessible to people with health problems or those priced out of long-term care coverage.

Short-Term Care Insurance can mind the gap in your income and assets.
Short-Term Care Insurance can mind the gap in your income and assets.

Short-Term Care Benefits

With short-term care coverage, you select the benefit amount. The benefit amount is usually in $10 increments from $50 to $300 per day. Then, you select the number of days (up to 360) to receive the benefit.

Unlike long-term care policies which typically have a 90-day waiting period for benefits, short-term care benefits go into effect the first day you need care. Triggers for benefit eligibility are generally the same as long-term care coverage. The policy pays for care when the policyholder has a cognitive impairment or can’t perform at least two of six activities of daily living without help. This includes eating, bathing, dressing, toileting, continence, or transferring from a bed to a chair.

“Short-Term Care Insurance is an alternative, affordable option compared to long-term care coverage.”

It’s important to note, short-term care policies may not cover all levels of care. Some short-term policies only cover facility care while others may only cover care in the home. Work with an LTC Specialist to be sure you understand all the features which can vary by carrier.

Is Short-Term Care Insurance Right for Me?

While short-term care insurance is recommended as a “Plan B”, it’s a great solution for individuals who can’t qualify for long-term care coverage or are priced out with higher premiums. Our motto: some coverage is always better than none!

 

Interested in a Short-Term Care Insurance quote? Request a free quote online and speak with an LTC Specialist about your options.