Long Term Insurance Subcategory A [Definitive 2022 Guide]

— Last Updated May 27, 2022

Long Term Insurance Subcategory A [Definitive 2022 Guide]

In this article

— Last Updated May 27, 2022

Read Time
8 mins
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Reviewed by
Eric Berkman
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Long Term Insurance Subcategory A [Definitive 2022 Guide]

Stephanie Wilson

Director of Operations

Read Time

8 mins
Group-27.png

Reviewed by

Eric Berkman

In this article

long term care insurance subcategory a

Long-term insurance is a broad category of coverage that is used to pay for long-term care needs associated with Activities of Daily Living (ADLs). It’s generally associated with older people requiring care workers in your home, assisted living facilities, or residence in a nursing or skilled care home. However, long-term care is not necessarily limited to seniors – it can apply to injured or disabled persons, too. In other words, while we all think we’re invincible when we’re younger and healthier, there might situations where we need extended help with certain Activities of Daily Living (ADL’s) like bathing, dressing, eating, toileting, and ambulating (moving from say a bed to a chair).  

Long term care insurance and the needs associated with long term care can be broken down into different subcategories. This is used to help define a policy related to the needs of a potential policyholder. In this definitive guide, we will be addressing ‘Long Term Insurance Subcategory A.

So, let’s dive into the details and ask, what is ‘Long Term Insurance Subcategory A?’

What is Long Term Insurance Subcategory A?

Information on ‘Long Term Insurance Subcategory A’ is relatively limited given its lack of obvious awareness and use in the financial products market. However, the definitions set out by different legislation to it as a subcategory of long-term care. It highlights the specific circumstances of care required by the policyholder in terms of what care can be covered through a particular long term care insurance policy. 

As with most other categories of long term care insurance there are certain nuances to Subcategory A, and it can be part of a conversation that you have with a licensed agent., who can walk you through the definition of ‘Long Term Insurance Subcategory A’ and it’s details, and see if your needs and situation might fall into this category. In this guide, we can break down the elements of what makes up this subcategory.

Definition

According to Associated Compliance, ‘Long Term Insurance Subcategory A’ refers to policies that cover the need for assistance with less financial commitment.  Those would generally refer to those requiring unspecialized care, or healthcare. The policyholder will have expenses covered for external help with daily activities, ensuring the person’s well-being. The subcategory is sought for older people who are generally considered well but have trouble with trivial tasks.

Examples

The term ‘Long Term Insurance Subcategory A’ is not widely used in presenting policy plans. However, the American Association of Long Term Insurance provides examples of policies that stem from the subcategory’s definition. Examples of the people placed into this insurance plan would be:

  • Those who need assistance with home duties such as:
    • Cooking
    • Cleaning
    • Bathing
    • Getting dressed
  • Need reminders of medication
  • Require companionship
  • Struggle with daily completion tasks outside the home

The Federal Long Term Insurance Program describes the types of care workers that support this subcategory of insurance. These include personal care, social services, homemaker services, unspecialized medical care, speech, physical, respiratory or occupational therapy.

What It Covers

Those with ‘Long Term Insurance Subcategory A’ policies will find that most plans will release funds to cover daily home health care services.  Note that this does not include round-the-clock help and excludes those with illness or ailments that require home care with medical expertise.

A person placed into this subcategory will see their insurance policies defined so that it covers or reimburses the cost of an unspecialized home carer to assist with day-to-day activities. Typically, the benefits of this type of plan kicks in when you reach a certain elderly age and are less able to care for yourself but are otherwise deemed to be mentally and physically fit.

Advantages

long term care insurance subcategory a

There are general advantages to finding placement in ‘Long Term Insurance Subcategory A.’ Those include:

  • Choosing the home care you want and being reimbursed
  • Less expensive premiums and monthly payments considering the care is unspecialized
  • Application approvals are faster and more likely

 

Disadvantages

Naturally, some disadvantages counterbalance this subcategory. We highlight the downside of these policies below:

  • Does not cover any medical emergencies requiring specialized skill
  • Premiums and costs can increase as you age
  • The plan could be void with any sudden illnesses or ailments

Of course, there are a plethora more advantages and disadvantages to ‘Long Term Insurance Subcategory A.’ Should you require more specific information, Policy Solver’s services are available to answer all your questions.

The definition breakdown ultimately begs the question – what are ‘Long Term Insurance Subcategory A’ products?

Long Term Insurance Subcategory A Products

The products that fit into ‘Long Term Insurance Subcategory A’ are policies, pensions, or social contributions covering home care services. In general, Fidelity showcases 4-different options those fitting into the subcategory could consider, not strictly limited to insurance companies. They are outlined below:

Government Assistance

There are many government programs for those who require care in ‘Long Term Insurance Subcategory A.’ Government assistance entities such as Medicaid, Medicare, and the Veterans Health Administration will contribute to home care costs. However, you will need to qualify for these programs based on various factors such as income and owned assets.

Many of these services can’t be relied upon to provide the care required. Generally, government programs don’t offer benefits for long-term care, even if you’re of elderly age. Parameters for eligibility also vary from state to state within the United States. If you’re a low-income family or veteran, this product may be ideal – but if not, perhaps check other options.  Your insurance agent will be able to help you decide if a Subcategory A plan makes sense for you. 

Traditional Long Term Care Insurance Policies

Most medical insurance providers will provide policies more tailored to your needs. Traditional ‘Long Term Insurance Subcategory A’ plans allow clients to choose how long they want the policy to last. Other variables include what it covers and how long you’ll need to wait before it becomes active. Policyholders usually pay annual premiums for life for this product or unless they decide to cancel their policy or let it lapse.

Traditional ‘Long Term Insurance Subcategory A’ policies are best for those who want a high degree of flexibility and customizability with their products. However, it should be noted that many insurers are abandoning these offerings given the changing times. If there are any available, the annual premiums may fluctuate, too.

Hybrid Policies

Hybrid policies are a relatively complex product concerning ‘Long Term Insurance Subcategory A’ policies. The core of the idea is that the plan incorporates both life insurance features with traditional long-term care insurance. This means that should you require long-term care in the home, the policy will cover the necessity whenever needed. If the plan is never used, then the policy will pay out a benefit to the beneficiary upon death. 

The intricacies of hybrid policies can vary between insurers, so it’s imperative to understand whether this is an ideal product for you. These plans would most suit those who find little risk with their future health and see that home care wouldn’t be hard to come by if required.  They are becoming more popular. 

Personal Savings

Personal savings are arguably the most straightforward product out of the 4. These accounts typically come in retirement plans, 401ks, or IRAs managed by insurers, pension funds, or other financial entities. Many employees of companies will be presented the option to pay into these to have a savings pot for future needs.

Should a personal savings account be opened reasonably early on in your career, you could find that it’s pretty sizeable. Considering that ‘Long Term Insurance Subcategory A’ persons usually only need home care, the finances could cover the lower cost of unspecialized services. However, this may not be feasible for those with lower incomes or savings.

Navigating through the maze of ‘Long Term Insurance Subcategory A’ products can be challenging given all the complexities. It’s recommended to seek impartial and transparent advice on the best bespoke products. Policy Solver is an agency that specializes in providing clear, concise, and beneficial information on this product and other long term care insurance offerings. 

Next up, how does ‘Long Term Insurance Subcategory A’ compare to other subcategories?

How does it compare to other subcategories?

The long-term care insurance subcategories are tied to the type of assistance required and the specialization of care involved with each policy. The other defined categories in long-term insurance are letters B and C, placing people into different areas of care requirements. We can see how they compare to each other below.

Long Term Insurance Subcategory B

‘Long Term Insurance Subcategory B’ is defined by the Financial Services Board as policies that relate to health, disability, and life plans. They will have a guaranteed return on the premiums paid for them. Policies that fall under this category are likely to include people that expect a requirement for assisted living, such as nursing homes in the future. Also, these may consist of coverage or reimbursements for those requiring specialized medical care inside the house.

Compared to ‘Long Term Insurance Subcategory A,’ B is a host of policies that cover more outside the basic assistance needs. For example, should a policyholder develop Alzheimer’s and require continuing supervision from care workers, the policy should cover this event.

Long Term Insurance Subcategory C

long term care insurance subcategory a

Those requiring other long-term care fit into ‘Long Term Insurance Subcategory C.’  These plans would cover the complete spectrum of necessary care when needed, such as: 

  • Home care
  • Assisted Living Facilities
  • Community Care
  • Nursing Homes

These benefits would become available after meeting a specific set of prerequisites.

More coverage in these policies would come at a much more significant expense than plans in ‘Long Term Insurance Subcategory A.’ But they offer a more comprehensive range of reimbursements for long-term care. Should there be family histories of issues that ultimately require long-term care, plans in subcategory C are often chosen to protect them.

The experts can clear these definitions and comparisons and lay them out in detail when helping you choose the right plan. Make sure you tell the experts everything about your health when applying for disability insurance.  

Who is it for?

‘Long Term Insurance Subcategory A’ is for those who do not need 24-hour supervision, though require daytime assistance to help them with trivial life tasks. This type of policy typically suits those who need unspecialized care, and helps people complete some household jobs they would otherwise have difficulty doing. This subcategory of insurance would benefit:

  • Older persons aged 65+
  • Injured or disabled persons that struggle with household management
  • Those with mental impairments that don’t require medical attention
  • Isolated persons needing companionship

Is Long Term Insurance Subcategory A worth it?

Ultimately, you probably wonder if an investment into a ‘Long Term Insurance Subcategory A’ policy is worth it. The argument in favor of purchasing a plan is that everybody gets old eventually. It would be nice to have the option to receive help when we are inevitably not able to do everything around the house that we used to. It can help you become confident that you’ll have the right coverage for the future.

However, ‘Long Term Insurance Subcategory A’ policies are not as extensive in what they cover. They are more affordable but don’t cover the specialized care needed in case of a medical ailment or assisted living. It might be worth exploring the risk surrounding your lifestyle, as well as the medical histories of yourself and your family, to gauge whether this subcategory would be the right option. There are certain reasons for long term care insurance rejection. so watch out.

Where can I find out more and get advice on Long Term Insurance Subcategory A?

Getting a sense of clarity of ‘Long Term Insurance Subcategory A’ and other long-term insurance subcategories isn’t the most straightforward task. However, Policy Solver began off the philosophy of being a client-dedicated resource in insurance. We are a company that can give simple, friendly, authentic, and transparent advice on ‘Long Term Insurance Subcategory A.’

Conclusion

‘Long Term Insurance Subcategory A,’ despite being broken down into a different sector, can be as complex as the bigger picture of long-term care. We hope this definitive guide offers better insight into what it is, how it benefits, and whether it’s right for you. Remember, there is always more in-depth information available from experienced agents should it be needed!

How can Policy Solver help?

Policy Solver will commit to finding the best insurance products at the most competitive prices. We will use our extensive network of insurers to discover the right policy for your needs. Consultations are free of charge, with commissions earned and paid by the insurers, if you decide to purchase the insurance.

References:

Investopedia (September 15th, 2021), , Long Term Care Insurance, retrieved from https://www.investopedia.com/terms/l/ltcinsurance.asp

 

Associated Compliance, (publishing date unknown), License Categories – An Overview , retrieved from http://www.associatedcompliance.co.za/AC_Manual_2013/6_Licence%20categories/Licence%20Categories%20-%20An%20Overview.pdf 

 

American Association for Long-Term Care Insurance, (publishing date unknown), Home Health Care, retrieved from https://www.aaltci.org/long-term-care-insurance/learning-center/home-health-care.php

 

Financial Services Board, (11th June 2010), Circular on Long Term Insurance Category B as defined Board Notice 60 of 2010, retrieved from https://www.fsca.co.za/Regulatory%20Frameworks/Documents%20for%20Consultation/Circular%205%20of%202010.pdf

 

The Federal Long Term Care Insurance Program, (publishing date unknown), Resources, retrieved from https://www.ltcfeds.com/planning-tools/resources

 

Fidelty, (24th August 2021), Long Term Care Options and Considerations, retrieved from https://www.fidelity.com/viewpoints/personal-finance/long-term-care-costs-options

 

December 30, 2021

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