Denied: Long Term Care Insurance?

One thing easy to forget about Long Term Care Insurance (LTCi) is, we have to apply for it and be underwritten. In other words, we could be DENIED COVERAGE and never receive a policy. LTCi underwriting is not like any other underwriting. Not like applying for life insurance or even long term disability insurance. It's different. Frankly, death is not the concern, living too long is.

Wait...WHAT?!

So, how difficult is it to pass underwriting? The most widely cited data comes from the 2022 Milliman Long-Term Care Insurance Survey, published by the American Association for Long-Term Care Insurance (AALTCI), which shows:

Applicant Age	Declined or Deferred
40-49	12.4%
50-59	20.4%
60-64	30.4%
65-69	38.2%
70-74	49.7%

The best available industry data indicates that denial rates generally ranged from about 20% in the 50-59 age group, rising to nearly 50% by ages 70-74.

Being denied LTCi can be frustrating, but a denial does not always mean you have no options. For couples, one spouse may qualify while the other does not. The goal is to understand why coverage was declined and look for a practical alternative.

Why are applicants denied?

LTCi policies—including traditional, short-term care, life insurance with long-term care benefits, and annuity-linked plans—are medically underwritten. Insurers may review health questions, medical records, and prescription history. They are mainly assessing the likelihood of future care needs.

Common concerns include cognitive or memory problems, diabetes complications, a recent stroke or heart event, neurological disorders, mobility limitations, and several health conditions occurring together. Age, medical history, and the severity or stability of a condition can also affect the decision

Simple steps after a denial -

1. Ask whether the application was declined for one specific product or by the insurer entirely. Different companies have different underwriting guidelines.

2. Work with an experienced LTC insurance specialist-broker (they represent you, and have contracts with several insurance carriers) that can pre-screen medical information and compare multiple carriers before submitting another application. This may help avoid unnecessary additional declines.

3. Do not automatically cancel the approved spouse’s policy. Having coverage for one person is generally more helpful than leaving both uninsured.

4. Review alternatives with that qualified insurance advisor. Short-term care insurance usually offers a limited benefit period—often about one year—but may cover home care or skilled nursing and can have more flexible underwriting.

5. Consider an annuity with long-term care benefits. Depending on the contract, the deposit may provide a larger benefit if care is needed, while also offering a cash value or income feature. Some plans may accept applicants who were declined for traditional LTCi.

6. If no insurance solution fits, discuss self-funding, savings, family resources, Medicaid eligibility, and legal or financial planning with appropriate professionals.

A denial can feel shocking, and is important information, not necessarily the end of the conversation. Comparing choices early can help an individual or couple build a realistic plan for future care costs.

Go to joesimon.solutions for more on this subject by going to FORMS then 'LONG TERM CARE: What's your plan Workbook'

CONTACT JOE: js@joesimon.solutions