Complaints about long-term care insurance include substantial rate hikes on premiums that buyers must pay or risk losing coverage, reports Forbes. Some buyers also complain that their insurers refuse to pay out when they need to collect on their policies. Long-term care policies also have the disadvantage of covering only nursing home care, while people may have diverse needs in old age.
Long-term care policies allow insurance companies to raise premium rates, leaving buyers with the options of losing the premium payments they have already invested, paying the higher rates or accepting fewer benefits, explains Forbes. Those facing higher premiums are unlikely to find a better policy if they drop the one they have and purchase a new one, as many insurance companies no longer sell long-term care insurance, and those that do charge more for new customers, points out Consumer Reports. To retain their policies and make premiums affordable, consumers must consider lowering or eliminating inflation protection, or lowering their benefit payouts.
Insurance companies selling long-term care policies do not always pay promptly when buyers attempt to collect their benefits, according to Forbes. For instance, insurance companies may argue that their customers' specific disabilities do not qualify them for benefits, although independent physicians may disagree, notes The New York Times.
Long-term care policies only cover nursing home or home care bills, while elderly people may instead need help to meet normal living expenses, states Forbes. If people instead invest in longevity insurance or annuities, they have control over how they spend their investment gains.