Policy Replacement BEWARE OF INSURANCE AGENTS BEARING REPLACEMENT POLICIES!!! However, there are situations where you should consider replacing an existing policy. The most common one is when your policy is old. Old varies, but 10+ years is a good rule of thumb. Newer policies have significantly better benefits than the oldest policies, although you will have to pay a significantly higher premium to obtain the new policy. In what ways can newer policies be better? Newer policies may (or may not) make it easier to qualify for benefits Six instead of five ADLs; No prior hospitalization required; No post claims underwriting; Newer policies may have better benefits: Home care coverage Assisted living facility coverage Waiver of premium for home care Easier to meet elimination period (non consecutive days, only once, etc.) Norm's policy The comparison is a two step process (Use the "LTC Policy Comparison Sheet;" or something similar. Look at more than one new policy). Compare your existing policy to what you can purchase now, making sure that daily limits, elimination periods, inflation adjustments, benefit periods are the same or similar. If your policy has an inflation adjustment, make sure the comparison is based upon the policy's current daily limits, not the daily limits when your bought it. This comparison will indicate the cost and benefits of replacing your policy with a new one. Keep in mind that in some ways the new policy will be inferior, for instance the 90 day certification rule. You also need to consider whether the existing policy adequately meets your needs. Does it have the daily benefits, home care coverage, inflation adjustment, benefit period and elimination period that you want? Options: Make no changes, because the benefits of newer policies are not much better and/or difference in premium is more than you want to pay; Keep existing policy, add new one to increase daily benefits or to add homecare coverage; Apply for new policy, and once new policy is approved cancel the old one. Copyright 2005 Arthur Stein. All Rights Reserved. No reproduction without permission. Contact astein@ltcguide.com