Long-Term Care Insurance Carriers Appear Motivated to Deny Claims—Here’s How to Fight Back

Long-term care (LTC) insurance is meant to provide support when individuals can no longer care for themselves due to chronic illness, cognitive decline, or physical limitations. These policies offer coverage for essential services, including nursing home care, assisted living, and in-home assistance. But for many policyholders, securing those promised benefits has become increasingly complex. In recent years, insurers appear more determined than ever to deny valid claims, leaving vulnerable individuals and families without the necessary care.

At Disability Insurance Law Group, we represent clients across the nation who face unfair long-term care insurance denials. Here’s what policyholders need to know about why this is happening—and how to respond.

The Financial Backdrop: Why Denials Are on the Rise

Understanding the insurer’s motivations is the first step to understanding the growing number of claim denials. Since the 1970s, long-term care insurers have incurred significant financial losses, primarily due to underpricing, longer life expectancies, and rising care costs. Many companies underestimated the actual cost of long-term care, expecting shorter benefit periods and lower service costs than what has occurred.

To address these losses, insurers attempted to increase premiums and limit coverage. Still, most eventually exited the LTC market. The ones that remain are stuck servicing outdated, money-losing policies, and many have responded by becoming more aggressive during the claims process.

Unfortunately, this often means rejecting legitimate claims over minor technicalities or imposing burdensome documentation requirements that most families are unprepared to meet.

Denial Strategies Policyholders Are Encountering

Long-term care claim denials often come as a shock, especially when care is needed. However, insurers frequently employ a range of tactics to avoid paying benefits.

These are among the most frequent justifications:

• Alleged nonpayment of premiums, even when caused by cognitive impairment.
• Disputes over the licensure or classification of a care facility.
• Refusal to cover personal care tasks, such as meal prep or hygiene support.
• Claims of insufficient proof that the policyholder needs help with at least two activities of daily living (ADLs).
• Reliance on insurer-hired physicians who review medical records without ever examining the patient.
• Claiming improvement in condition as a reason to terminate benefits.
• Improper use of Alternative Plans of Care (APCs) to reduce benefit scope.

These obstacles are rarely about the validity of the care—it’s about creating friction that deters families from continuing to pursue benefits.

The Elimination Period Trap: Delays with Consequences

Nearly all LTC policies include an “elimination period”—a waiting period, often 30 to 180 days, during which the policyholder must pay for care out-of-pocket before benefits begin.

What many policyholders don’t realize is this: the elimination period doesn’t begin until qualifying care is actively being received. If you submit a claim without first hiring a licensed care provider, the clock hasn’t started. Insurers often exploit this by delaying the claim review process while the insured waits, only to argue later that benefits still aren’t payable because the elimination period hasn’t been satisfied.

This tactic can delay much-needed benefits indefinitely unless it is addressed appropriately from the beginning.

Building a Strong Claim: How to Present Compelling Evidence

Because insurers scrutinize LTC claims so heavily, policyholders must take a proactive approach to presenting evidence. It’s not enough to demonstrate need—you must connect the medical reality to the language and requirements of your policy.

A strong claim should include:

• Detailed physician statements that specifically address the policy’s definitions, including the inability to perform 2 of 6 ADLs.
• Functional Capacity Evaluations (FCEs) to objectively assess physical limitations.
• Neuropsychological testing for cognitive impairments.
• In-home assessments performed by licensed nurses or caregivers.
• Facility and caregiver licensure documentation, where applicable.

Without this level of documentation, even well-meaning families with legitimate needs may see their claims rejected on technical grounds.

Avoid Signing APC Agreements Without Legal Review

Alternative Plans of Care (APCs) are provisions in many LTC policies that allow the insurer and policyholder to agree on non-traditional services or care arrangements. In theory, APCs can be flexible tools that help policyholders receive benefits tailored to their needs.

In practice, however, some insurers misuse APCs to pressure policyholders into accepting reduced or inferior benefits. In some cases, insurers even deny covered services before presenting an APC that offers partial reimbursement, creating a false choice.

Never sign an APC agreement without having it reviewed by a skilled attorney. What may seem like a helpful compromise can limit the benefits you’ve paid for over decades.

Legal Advocacy Can Make the Difference

Medical professionals are focused on care, not on crafting documentation to satisfy complex insurance requirements. And that’s where legal guidance becomes critical. At Disability Insurance Law Group, our attorneys review your policy, identify potential pitfalls, and help build a claim file that matches your care needs to the insurer’s contractual obligations.

If your long-term care claim has been delayed, underpaid, or denied outright, you do not have to accept the insurer’s word as final. Contact us today at 954-989-9000 or online to schedule a complimentary consultation. We’re here to make sure the coverage you paid for is there when it matters most.