June 20, 2024
State Farm Long Term Care Insurance Review

State Farm is not among our top picks for the best long-term care insurance companies because it stopped issuing new long-term care insurance policies in 2018. That means it will continue to service existing policies, but you can no longer purchase this type of product through State Farm agents.

 

If you are still interested in getting long-term care benefits through State Farm, the company offers a Flexible Care Benefit Rider that can be added to select life insurance policies underwritten by the company. This rider is not available in New York or California.

Cons explained

No longer issues new long-term care insurance policies

State Farm stopped issuing new long-term care insurance policies in 2018. The company will still service existing policies, but you cannot purchase long-term care insurance through its agents. And while State Farm still sells a long-term care rider, those may not be available in every state. Additionally, terms and conditions may vary by state as well.

 

The monthly cost of the Flexible Care Benefit Rider is subject to increase

Since the monthly cost of the Flexible Care Benefit Rider is not guaranteed, the price can increase up to a maximum amount based on the policy’s terms.

 

Rider will not pay for losses related to pre-existing conditions

According to State Farm, this rider will not cover losses related to a pre-existing condition, unless the loss happens over six months after the rider’s effective date.

State Farm long-term care insurance offerings

State Farm offers a solid array of long term care policy options, but not all options are available in all states. It sells policies that qualify under the long term care partnership rules of all states that participate in the program.

 

The company also offers a rider on its life insurance policies that, in effect, converts them into a hybrid life/LTC policy. These riders, however, are not available in California or New York.

 

Policy types

Individual / Standard

State partnership

Hybrid life and long-term care

Tax qualified

Types of covered care

In-home care

Assisted Living / Adult Day Care

Nursing Home

Hospice Care

Medical Help Systems

Facility coverage

Any facility

Available policy riders

Inflation Protection

Return of Premium

Waiver of Premium

Home Modification

Inflation protection

Future purchase option

Simple automatic increase benefit

Compound automatic increase benefit

State Farm’s policies offer a $500 daily limit should be more than sufficient to pay for 24/7 home health aide care or for care in a nursing home. The company’s benefits triggers are also reasonably designed and do not unduly burden consumers.

 

For eligibility, State Farm policyholders must be unable to perform two activities of daily living. All claims for benefits must be processed through a State Farm agent, a practice that will please some customers and frustrate others.

Maximum daily benefit limit: $500 per day

Lifetime benefit period: 5 years

Unlimited benefit period: None

Elimination period: 30,60 or 90 days

For benefits to be paid out, the policyholder must have a letter from a physician certifying that they have limitations that prevent them from performing at least two activities of daily living (ADL) or a cognitive impairment like Alzheimer’s disease.

 

State Farm long-term care insurance financial stability

State Farm is a solid choice for long term care insurance. With solid financials and almost a century of operations, the company appears to be prudently managed-an important consideration when purchasing policies that may not pay out for years or decades.

State Farm long-term care insurance accessibility

State Farm is the largest property and casualty insurance company in the United States. Its policies and riders are sold only through its network of agents, although quotes are available online. The company is located in Bloomington, Illinois, and does business in every state and the District of Columbia.

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