Life & Health Insurance Exam (National Portion)Health InsuranceEasy
A 68-year-old client is concerned about the costs of long-term care in the future. They are considering a Long-Term Care (LTC) insurance policy. Which of the following is a primary factor an insurer uses to determine eligibility and premiums for LTC insurance?
- AThe client's driving record and credit score.
- BThe client's current health status and medical history.
- CThe client's current income level and financial assets.
- DThe client's marital status and number of dependents.
Show answer & explanationAnswer & explanation
Correct answer: B. The client's current health status and medical history.
An applicant's current health status and medical history are primary underwriting factors for Long-Term Care insurance, as they directly indicate the likelihood of needing care and the potential cost to the insurer.
Why the other options are wrong
- A. Driving record and credit score are not typical underwriting factors for health-related insurance like LTC.
- C. While financial status might influence affordability, it's not a primary underwriting factor for eligibility/premiums.
- D. Marital status and dependents are generally not primary factors for LTC underwriting.
LTC Underwriting Factors
Key elements insurers assess to determine eligibility and premium rates for Long-Term Care insurance.
- Current health status is paramount.
- Medical history, including pre-existing conditions, is reviewed.
- Age at application significantly impacts premiums.
- Cognitive function assessments are common.
Memory trick: Health and Age are the main stage.