Your Health - Life Insurance Versus Long Term Care
When it comes to your health and underwriting, did you know life insurance versus long term care are two different policies? It’s often the case that a client will mention they got a “preferred” rating with life insurance but got “rated” with long term care. Why is this?
Well the reality of it is, they’re two different insurances solving for two different needs. It’s understood that life insurance is designed to satisfy a financial need when there is a loss of life. A spouse would find themselves between a rock and hard place with the loss of their partner in terms of finances. But what if their partner didn’t pass away but became severely disabled? Often times you hear stories of devastation when a spouse has a stroke where, while still living, they could end up requiring in home care every day!
So life insurance is solving for “mortality”, or basically what might cause you to pass away sooner. This is why for people who smoke, life insurance is generally twice the price. It’s usually assumed that as a smoker, you’re not going to be around as long. Oddly enough when the carriers solves for long term care, they are solving for “morbidity” or things that would cause you to be disabled sooner in life. So one might ask, why aren’t they charging me a higher price for my long term care policy even though I’m a smoker? It’s because it is assumed you’re not going to be around as long! But you are generally charged double for life insurance because carriers have to pay that policy out twice as fast.
Also, when considering your health and life insurance versus long term care, there are many conditions that might make you uninsurable for one type of policy, but insurable for another. For instance, more often than not, clients who previously had cancer don’t believe they can get long term care. The reality is, in most cases as long as you’ve been cancer free for a two year period, carriers will consider you for coverage.
The best way is to know up front what the conditions and medications are, so you have the best chance of getting insured. So it’s always a good practice to work with an agent if you have health concerns when applying for either policy.
About the author: Mark Yurkovic has been in the life insurance business for over 12 years, and holds CLTC, LUTCF, and CES designations. He enjoys building remote control boats, and playing instruments including the piano, guitar, banjo, and mandolin. Mark would love to discuss life insurance options and work towards finding the best policy fit for your family. You can contact Mark at 1-800-651-1953 or MYurkovic@Pivot.com.