Since my last article on short-term care (STC) policies was published in LifeHealthPro, I have received hundreds of calls from agents who said “I didn’t even know this kind of product was available.” While it’s true that only a few carriers offer this type of coverage today, I believe more will offer it as the population ages and the cost of traditional LTCi continues to climb.
To help my agents, I decided to put together a product comparison.
Click here to download an Excel spreadsheet version of the STC product comparison table.
Click here to see a PDF version of the STC product comparison table.
While researching the products I learned that information on STC is almost impossible to find on the internet. Whether you type in “STC” or “short-term care” or “recovery care” – what you normally end up with is short-term health insurance – a totally different animal. Because of this experience, I have also included the carrier’s websites and 800 phone numbers so any agent who wants more information can contact the carrier directly.
I discovered there are subtle differences from carrier to carrier. Most max out their benefits at 360 days. Some offer only coverage for facility care, some are comprehensive and some offer home care as a rider only. The top issue age was 85 and the minimum is 18. Most were reimbursement with just one carrier offering Indemnity benefits and only 1 carrier offers monthly benefits.
The most important difference is in how the policies were filed and approved. Most states consider these policies to be health insurance and not long-term care. However, some states consider them non-tax qualified LTC and as such, require the agent to complete the Partnership certification prior to soliciting business. You’ll need to check with each carrier to see how their policy was approved in your state. None of these carriers have their product approved in all 50 states.
Short-term care insurance is the perfect product for many clients. It’s also a relatively new product and chances are, your clients have not heard of it. This gives you a great reason to pick up the phone and give your current clients a call. With premiums averaging $2200 per year, selling just two of these a week could increase your bottom line significantly. More importantly, you’re providing a product that most of your clients are very likely to use.
As previously mentioned, information on these products was difficult to find. The information given here was taken from company brochures and applications.
Note: American Republic Insurance Company also offers a STC policy. They are not included in this grid because I could not locate any concrete information on their product. Calls to the carrier went unanswered and I couldn’t locate anything on the internet. If I receive information on their product I will be glad to add them to this comparison