Short-term Care Insurance

What Is Short-Term Care Insurance?

A little-known insurance option can be an answer for some people who might need care, but are unable to buy long term care insurance.  Short-term care insurance provides short-term coverage for nursing home, assisted living or home care.

The typical Short-Term Care insurance (STCi) policy provides coverage for 1 year or less. For many people, this is a very appropriate and affordable amount of coverage. It is true that some long-term care claims last for many years, however, almost half (49%) of long-term care insurance claims LAST ONE YEAR OR LESS.

The majority of policies have a 0-day deductible (Elimination Period) and a full year of benefits. Simply, that means the policy pays on the very first day one qualifies for benefits. Most traditional long-term care insurance policies (about 94%) are sold with a 90-Day Deductible that must be met before benefits are paid.

It is important to know that these policies can pay in addition to Medicare — something a traditional Long-Term Care Insurance policy is prohibited from doing.

Most Short-Term Care applications have 7-to-10 health questions. If you can answer “NO” to all the questions, you are 95% through the health underwriting process. However, there are policies that have ONLY 2 “YES” “NO” QUESTIONS and can be ideal for people with existing health problems.

Who Should Consider A Short-Term Care Policy?

  • You (or a spouse) were DECLINED for traditional LTC Insurance.
  • You want a LESS EXPENSIVE option (than traditional long-term care insurance).
  • You WAITED TOO LONG to buy long-term care insurance (cost is now too high!).
  • You are AGE 80 OR OLDER.
  • You are a SINGLE WOMAN (rates for Short-Term Care policies are NOT GENDER-BASED as they are with traditional long-term care insurance).
  • You have a long term care insurance policy and you want to cover the Elimination Period.

The typical person buying short-term care insurance is between the ages of 65 and 74 and has a net worth of less than $500,000.

Short-term policies are not the answer for everyone, however. They may not cover all the levels of care that a long term care policy would cover. As with any insurance product, buyers need to make sure they understand what coverage they are purchasing. These policies are also not regulated to the same extent that long-term care insurance policies are, so there are few consumer protections.

How Much Does Short-Term Care Insurance Cost?

  • Typical premium at age 65 — $105 monthly .
  • Typical premium at age 70 — $141 monthly option.

A Few Short-Term Care Facts

  • Minimum Applicant Age: 40 or 50.
  • Maximum Applicant Age 85 – 89.
  • Typical Benefit Amount $100, $150 or $200 per-day.
  • Can a policy pay for Home Care? YES! .
  • Can a policy pay for Assisted Living? YES! .
  • Can a policy pay for Nursing Home Care? YES! 
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