Jane Dotson
Short-term insurance is a temporary and flexible solution for those who need health insurance for a limited time. It is cheaper than long-term insurance but provides coverage for a shorter time, from a few days to a year, and is easier to qualify for. However, short-term policies only cover care for a year or less, limiting how much they pay out per day or week. It is important to assess your health needs, financial situation, and coverage priorities to determine if short-term insurance is worth it for you.
| Characteristics | Values |
|---|---|
| Cost | Cheaper than long-term insurance |
| Coverage period | From a few days to a year |
| Application process | Easier than long-term insurance; no medical exam required |
| Cutoff age | Typically 89, compared to 79 for long-term insurance |
| Payout | Immediate, unlike long-term insurance |
| Applicant health | Accepts older and less healthy applicants than long-term insurance |
| Applicant affordability | For applicants who cannot afford long-term insurance |
| Applicant preference | For applicants who only want a home care benefit |
| Number of insurers | Limited number of insurers offer short-term policies |
| Number of agents | Very few agents are versed in short-term policies |
| Applicant health problems | Recommended to use an agent who understands this type of insurance |
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What You'll Learn
Short-term insurance is more affordable
Short-term insurance is also easier to qualify for, as the application does not require a medical exam and has a simpler medical underwriting process. The policies accept applicants at older ages, with a cutoff age of 89, compared to 79 for most long-term policies. This makes it a good option for those who are older and may have been turned down for long-term insurance.
Short-term insurance is also a good option for those who are in between jobs or waiting for other insurance coverage to begin. It can provide coverage for a few months or up to a year, filling in the gap until an individual can obtain long-term insurance.
In terms of cost, short-term insurance is generally cheaper than long-term insurance. For example, a short-term policy for 12 months with a $1 million coverage per individual would cost about $150/month, compared to $800/month for the cheapest possible ACA plan with a similar deductible.
Short-term insurance is also a good option for those who are self-employed and do not qualify for any help paying for ACA marketplace premiums due to their income. It can provide a temporary solution until they can lower their income and qualify for subsidies.
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It's easier to qualify for short-term insurance
Short-term insurance is easier to qualify for than long-term insurance. This is because short-term insurance does not require a medical exam, and applicants can be much older. The cutoff age to buy short-term care coverage is typically 89, while for most long-term care policies, it is 79.
The application process for short-term insurance is simpler, with some companies only asking a handful of yes-or-no health questions. For example, "Have you had a heart attack in the past 24 months?" or "Are you currently using a walker?". This makes it a good option for those who are older, too unhealthy, or cannot afford long-term care insurance.
Short-term insurance is also a good option for those who are between jobs or waiting for other insurance coverage to begin. It can provide coverage for a few days up to a year, filling in the gaps when someone is uninsured.
Short-term insurance is more affordable than long-term insurance, but it provides coverage for a shorter time period. It is important to consider your own health needs, financial situation, and coverage priorities when deciding between short-term and long-term insurance.
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Short-term insurance is more flexible
Short-term insurance is a flexible option for those who need temporary coverage. It is a good choice for people who are in between jobs or waiting for other insurance coverage to begin. For instance, short-term insurance can be used to bridge the gap when a person misses the Affordable Care Act (ACA) Open Enrollment Period.
Short-term insurance is also a good option for those who cannot afford long-term insurance. Short-term insurance is cheaper than long-term insurance because it provides coverage for a shorter period, from a few days to up to a year. For example, a 65-year-old applicant would pay about $63 a month for a one-year short-term policy, whereas the cheapest ACA plan for the same person and their spouse would be $800 a month.
Short-term insurance is also more flexible in terms of eligibility. The application process is simpler, with no medical exam required and only a handful of yes-or-no health questions to answer. The cutoff age to buy short-term care coverage is typically 89, while for most long-term care policies, it is 79. Long-term policies also feature an "elimination period", which is the number of days you pay for care before the policy starts paying out. This period is typically 90 days, whereas short-term insurance generally pays out benefits immediately.
Short-term insurance can also be used as a supplement to long-term coverage, covering the cost of care during the long-term policy's elimination period. However, it is important to note that short-term insurance has its limitations. It only covers care for a year or less, limiting how much it pays out per day or week. It also does not provide comprehensive coverage and may not be ACA-compliant.
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Short-term insurance lacks comprehensive coverage
Short-term insurance is a temporary solution for those who need coverage for a short duration, such as during gaps between jobs or while waiting for long-term insurance coverage to begin. While it is a more affordable and flexible option, short-term insurance lacks comprehensive coverage compared to long-term insurance plans.
Short-term insurance typically covers a period of a few days to up to a year, while long-term insurance provides coverage for more than a year. This limited duration of short-term insurance policies restricts the total amount of payout, resulting in lower overall coverage.
Short-term insurance is often chosen by individuals who are unable to obtain or afford long-term insurance. It is easier to qualify for short-term insurance, as the application process does not require a medical exam and has less stringent health-related questions. The higher age limit for short-term insurance, typically 89 compared to 79 for long-term policies, also makes it more accessible to older individuals.
However, the trade-off for this increased accessibility is a lack of comprehensive coverage. Short-term insurance may not cover all the essential health benefits that long-term insurance provides, such as preventive care, mental health services, and maternity care. It may also have limitations on the daily or weekly payout amounts, resulting in insufficient coverage for extended periods of care.
Additionally, short-term insurance may not be accepted by all healthcare providers or institutions. It is important for individuals considering short-term insurance to carefully analyse their health needs, financial situation, and coverage priorities to determine if it is the right choice for their circumstances.
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Short-term insurance is not widely offered
Short-term insurance is often sought by those who are unable to obtain long-term insurance or cannot afford its higher premiums. Short-term insurance is more affordable than long-term insurance, but it also provides less coverage. It is important to carefully consider the value of short-term insurance plans and whether they are suitable for one's needs.
Short-term insurance plans have a limited duration, typically covering a period of a few days to a year. They are designed to bridge temporary gaps in coverage and are not intended for long-term care. The application process for short-term insurance is simpler, often requiring only a handful of yes-or-no health questions. The cutoff age for purchasing short-term insurance is typically higher than for long-term policies, making it an option for older individuals who may have been turned down for long-term coverage.
Short-term insurance may be a suitable option for those who require temporary coverage, such as during gaps between jobs or while waiting for long-term insurance to begin. However, it is important to carefully review the terms and conditions of short-term insurance plans, as they may have limitations and exclusions that could impact the level of coverage provided.
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Frequently asked questions
Short-term insurance is a temporary, flexible, and affordable solution for those who need coverage for a short period, such as between jobs or waiting for other insurance coverage to begin. It is typically easier to qualify for than long-term insurance, as it does not require a medical exam, accepts applicants at older ages, and has simpler medical underwriting.
Short-term insurance is a good option for those who want some protection but are too old, too unhealthy, or cannot afford long-term insurance. It is also a good option for those who only want a home care benefit. Short-term insurance is also cheaper than long-term insurance.
Short-term insurance only covers care for a year or less, limiting how much it pays out per day or week. It also provides less coverage for the money spent. It is also harder to find insurers who offer short-term plans, and there are very few agents versed in these policies.
