HOW IS LTCI UNDERWRITTEN?
“Cognitive impairment” usually is defined as the lack of adequate awareness and perception, as well as the ability to understand and reason that will allow an individual to function independently. This is a legal description and is often used as a trigger for LTCI benefits. An insured may be able to bath, dress, eat and otherwise take care of themselves physically, but if they have a cognitive impairment as defined by the law (HIPAA) and attested to by a licensed health care practitioner, they are entitled to benefits under the tax-qualified plan (and under most all LTCI plans). This test is almost always required for applicants age 75 or older, or younger if there is some underwriting reason to suspect a cognitive impairment. While underwriters tend to discount any situation where a person who is otherwise able to take care of themselves, become flustered at the interview and fail the test, it has happened. For insurance purposes, cognitive impairment is often defined as a deficiency
