Abromson & Carey, Attorneys at Law
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27+ Years Helping the Disabled
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What is best: long-term disability or long-term care?-Part II


The previous post on this blog provided an overview of long-term disability insurance and long-term care insurance. While many people in New Jersey may benefit if they have both types of coverage, the fact remains that affording both may be difficult. Therefore, a person planning to buy a long-term insurance policy should consider certain factors before making the decision about which policy to buy.

First, a buyer should look at the number of years that are left before retirement, which is at age 65. This factor is important because payments from a long-term disability insurance policy stop at the age of 65. Therefore, if the person does not have 10 to 15 years left before retirement, it may not be a smart purchase.

Next, the buyer should be fully aware of that person's own health condition. That is because many policies, both for long-term disability and for long-term care, exclude pre-existing conditions. Therefore, it is important to disclose every detail about the person's health so that disputes can be avoided later.

Another important point to consider is whether the person can afford a private long-term insurance policy for disability or for care. Typically, an average long-term care policy costs $2,300 a year; however, the cost can vary, depending on age, health, length of policy and other factors. The cost of a long-term disability insurance policy can also vary, depending on the same factors. However, as a benchmark, a buyer can expect to pay 1 to 3 percent of the person's annual salary as a yearly premium.

Finally, the buyer should consider the various benefits and riders offered by the insurance companies when the person buys either a long-term disability insurance policy or a long-term care insurance policy. Some examples of such benefits are cost-of-living adjustments and long-term care riders attached to life insurance policies. A buyer should select the policy that meets the person's particular requirements best.

However, as mentioned in the earlier blog post, buying long-term disability or long-term care insurance does not guarantee smooth claim processing. In fact, many people who have purchased such polices have their claims denied, often without adequate reasons. Therefore, it may be a wise decision for those people to file their claim with the help of an attorney.

Source: Forbes.com, "Long-Term Disability Insurance vs. Long-Term Care Insurance," Robert DiGiacomo, Aug. 12, 2015

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