Scammers are committing long-term care insurance fraud.
Paying for long-term care is a daunting expense in retirement.
Medicare does not provide coverage for these services.
For this reason, many people must seek alternative means of payment.
One such option is long-term care insurance.
According to a recent The Street article titled “How to Protect Yourself and Your Family From Long-Term Care Insurance Scams,” scammers are taking advantage of this need by perpetuating long-term care insurance fraud.
These scams come in a variety of forms, so you should be aware of them.
What are they?
These policy providers design a policy to prioritize profit over the needs of the senior policy holder.
If you are quoted one or more policies with unusually high premiums to “meet your needs,” these are signs of inappropriate policies.
And, in most cases, a single policy should meet your needs.
Individuals committing long-term care insurance fraud may suggest you cancel on existing policy to upgrade to a better policy.
Often they request higher payments for no improvement in coverage.
If you follow the advice of the scammers, you will forfeit premiums paid into the old policy when you cancel.
If new pre-existing conditions have developed between your first policy and this second one, these may also increase the cost to you.
The policy sold to you by those committing long-term care insurance fraud may be fake.
This means you will pay premiums but receive nothing when you need your insurance.
Before purchasing long-term care insurance, you should monitor your state insurance department to determine whether the insurer is valid.
Falsely representing benefits
People are not always honest about coverage.
By applying pressure to purchase a specific policy and misrepresenting benefits, scammers target those looking to purchase a long-term care insurance policy.
To prevent yourself or a loved one from falling victim to long-term care insurance fraud, diligently research your options before purchasing a policy.
In some instances, a third-party facilitator can be helpful.
Having conversations with your loved ones to discuss your options and goals will help you get the right policy to meet your needs.
Better yet, ask your estate planning attorney for a referral to a long-term care insurance professional.
Reference: The Street (May 15, 2020) “How to Protect Yourself and Your Family From Long-Term Care Insurance Scams”