DELAWARE INSURANCE DEPARTMENT

What must be included in a Long-Term Care Policy?

Like most insurance policies, the details of services covered and benefits paid will vary from policy to policy. However, state law requires that certain provisions be included in all long-term care insurance policies. Some of these provisions are:

• Coverage for all levels of nursing home care: skilled, intermediate, and custodial;
• Coverage for 12 months or longer;
• Policies must be guaranteed renewable> This means the company cannot cancel your policy for any reason except non-payment of premiums or a misrepresentation on your application for coverage;
• No longer than 6-month pre-existing condition exclusion;
• 30-day free look period. You can return the policy for any reason during this time and receive a full refund.;
• Benefits cannot be conditioned on a hospital stay prior to admission to a nursing home;
• Benefits cannot differ based on the type of illness or disability being treated. However, policies do not pay for drug or alcohol treatments, or mental or nervous disorders. Coverage for those diagnosed as having Alzheimer's disease and other organic brain disorders is required.

Other long-term care benefits do vary widely by policy. For example some policies:

• Pay a fixed benefit amount per day;
• Have daily limits on payouts;
• Have a ceiling on total benefits;
• Offer benefit periods of 2, 4, 6, 10 years, or a lifetime;
• Offer elimination periods of 30, 60, or 90 days. The longer the elimination period you choose, the lower the premium;
• Have a waiver of premium benefit which allows you to stop paying premiums once you start receiving benefits.