When we hear something once, we might pay attention but when we hear the same thing from totally unrelated people, don’t we begin to suspect there’s a trend? 

Some of the conversations a person can have with long-term care insurance claim departments are most enlightening and interesting.

Two different claim departments from two different leading LTC carriers regularly get LTC claims submitted 12 or even 24 months after the claim event. Surprised?

Why on earth would someone wait that long to receive the money for which they are entitled?

It’s because the family “just found” the LTC policy!

The insured needed daily living assistance, was not communicative, and the family just “happened” to find the policy in a shoebox or file cabinet in the basement.

Have you ever been into the basement of the house that someone has lived in for 30 years and tried to find a specific file?

It is wonderful that a policy gets found and even more wonderful that the carrier is paying “late” claims, even though some of which they are no longer contractually obligated to pay.

What about the LTC policies on other insureds that never get found?

If some do get found, others surely do “not” get found.

Caregivers and families can tell many stories about luckily finding policies or, on the other hand, “knowing” mom or dad bought a policy, but they could never find it once it was needed.

These are not isolated incidences, according to LTC carriers. And it goes without really saying that certainly if someone lapses their policy, it’s a whole different story. It’s a person’s right and decision.

But what about the person who is paying the premiums for the duration and the carrier gets a bye on the contractural agreement because the policy was not found?

The claimant made a smart choice when buying the policy, but in the end the family loses a lifetime of assets and now the family home has a lien and the insured is on Medicaid in a Medicaid facility.

This just cannot be right! Sure, the policies that eventually get found get paid as agreed, but then the assets might be gone, mom or dad is in a Medicaid facility, and now the family gets a $200,000 check.

At this point it’s better than nothing for the family, but not for mom or dad.

We can hear the family discussions now…

“I sure wish mom had bought long-term care insurance because she really wants to remain at home in her house of 30 years.”

or

“Dad did buy a policy, but never told anyone, which is exactly like not buying a policy at all.”

The insurance carriers and regulators require a designated third-party in case the premiums aren’t paid. What about a third-party to make sure a claim is filed?

Perhaps a third-party notification memo should be created at the time of purchase. The new policyholder is then able to designate several people who get notified about the policy purchase.

Yes, these people may or may not be around 25 years later at claim time, but most certainly the odds of that effort outweigh the strategy of hope.