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Critical Illness Insurance vs Long-Term Care Insurance for Seniors

What is Long-Term Care Insurance?

Long-term care (LTC) insurance can help minimize the financial risk of long-term care by acting as a type of coverage which provides nursing-home care, home-health care, and personal or adult daycare for individuals age 65 and older or for those younger than 65 with a disabling condition that requires constant supervision.

It is worth noting that critical illness insurance is in no way a sufficient or suitable replacement for LTC insurance...

In general, long-term care insurance is a type of private insurance that covers all or part of assisted living facilities and in-home care for those who qualify, and is usually available to anyone who can afford to pay for it.Most long-term care policies only cover a specific dollar amount for each day spent in a nursing/ assisted living facility and home-care visit, so it’s important to read the details of your policy carefully before committing to any one long-term care insurance policy.1


What is Critical Illness Insurance?

Critical illness insurance is a type of supplemental health insurance that helps provide additional coverage for qualifying medical emergencies. Generally speaking, these policies are low in cost due to the specific pool of illnesses and emergencies they cover, some of which include heart attack, stroke, and cancer. Where LTC insurance pays a specific dollar amount towards care per day, critical illness insurance pays a one-time cash benefit out to the insured in the event they have a qualifying medical emergency.
One of the appeals of critical illness insurance is that the money received in a claim can be used for any variety of things, like:
  • Medical treatments
  • Daily living expenses
  • Transportation
  • Vacation
  • And more
In other words, this generally low cost policy can be appealing due to the financial freedom the policy provides. However, it is worth noting that critical illness insurance is in no way a sufficient or suitable replacement for LTC insurance, and you may want to consider purchasing it in addition to a LTC in order to ensure you don’t face financial hardship when it comes to your long-term care or a sudden medical emergency.
Seniors looking to purchase LTC insurance or critical illness insurance should speak to a licensed insurance agent to discuss their options and use their individual needs and wants as their primary motivation for getting either or both policies.
  1. Administration for Community Living, What is Long Term Care Insurance, accessed 2021