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What Is Assisted Living Insurance?

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  • Written By: Malcolm Tatum
  • Edited By: Bronwyn Harris
  • Last Modified Date: 25 February 2020
  • Copyright Protected:
    2003-2020
    Conjecture Corporation
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Assisted living insurance is a type of long-term care insurance that provides resources that help to offset the cost of assisted living facilities as well as allay some of the expenses related to ongoing senior car. Insurance of this type helps to ensure that even if the insured party becomes unable to pay the costs associated with ongoing home care and has to enter some sort of assisted living center, those costs will be covered by the terms of the insurance policy. Coverage of this type can provide a great deal of peace of mind for both retirees and their families who would otherwise struggle with the costs necessary to provide the senior with a comfortable and safe living environment.

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While assisted living insurance can be purchased at any age, it is not unusual for consumers to begin thinking about this type of coverage in the years just before retirement. Deciding when to make the purchase often involves considering several different factors, including the current health condition of the party to be insured, allowing for any ongoing health issues that could trigger the need for assisted living sooner rather than later, the amount of coverage required, and how long it would take to pay in enough to receive full benefits under the terms of the insurance contract. For example, if the terms would require that the policy be active for a period of ten years in order to receive full benefits, it may be wise to establish the insurance in the person's early to late fifties, making it easy to draw on those benefits if the insured party should require home care or some other form of assisted living shortly after permanent retirement.

Determining the amount of coverage necessary as part of the assisted living insurance often requires researching the costs of home care and assisted living facilities in the area in which the insured party would prefer to live after retirement. Keeping in mind the rate of inflation and the impact that a higher cost of living would have on the resources of the insured party, it is possible to project a figure that reasonably represents the amount of coverage that should be sufficient. From there, the task involves identifying an insurance provider that offers the right combination of benefits and deductibles at a premium that the policyholder can reasonably afford.

Along with identifying viable assisted living insurance plans based on the scope of coverage and the price, it is important to qualify the provider as well. Focus attention on providers with higher ratings, indicating that the companies demonstrate a higher level of honesty and integrity in how they do business. Also make sure the provider is financially solvent and is likely to remain so for many years. State and provincial insurance departments can provide a list of providers who are authorized to operate within the jurisdiction, and also assist consumers in contacting the several rating agencies that monitor the activities of different providers offering assisted living insurance policies.

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