The insurance industry is facing an impending crunch as baby boomers get to the age where long term medical care in specialized facilities becomes increasingly necessary. Insurers commonly offer long term care insurance to help fill gaps in regular primary care health insurance. However, claims for long term care insurance can be denied for a wide variety of reasons.

Although bad faith is illegal, it is no secret that granting every claim is against an insurance company’s financial interests because long term care can be amongst the most costly care that an individual can receive due to the extended periods specialized care that may be medically necessary.

According to Arizona law, insurance that is sold as long term care must provide benefits for 24 consecutive months or longer, and cannot be limited by clauses that would shorten the period. Rowe v. Bankers Life & Cas. Co., 572 F.Supp.2d 1138 (D.Ariz. 2008).  In the Rowe case an insurance company tried to get out of its obligations by placing clauses in the policy that limited the amount of time that the insured could receive care for to less than 24 months, even though it was sold as a long term care policy. This strategy was invalidated but insurers have other tactics that they use to try to prevent having to meet the obligations of long term care insurance contracts.

One common strategy is to stall claim payments by requiring all forms to be submitted via postal mail and not allow electronic submissions. Insurers may also send out incorrect forms or offer reduced benefits.

Of course many insurance companies operate in an ethical manner. However, it is important to keep in mind that insurers sometimes illegally deny coverage and you have rights to demand the full benefits due to you under your policy.