A Strategic Perspective for Insurance Agents
As agents, we’re trained to look ahead and to help clients prepare for risks that could derail their retirement plans and strain their families emotionally and financially. We spend a lot of time discussing long-term care insurance (LTCI), Medicaid planning, and the gaps in Medicare. But there’s another option that’s often overlooked: short-term care insurance (STC).
STC isn’t a replacement for traditional LTCI but it’s a complement, a bridge, and in many cases, a solution when traditional LTCI is no longer viable. As clients’ needs evolve and underwriting gets tighter, it’s time we took a serious look at how STC fits into our extended care toolbox.
What Is Short-Term Care Insurance?
Short-term care insurance provides coverage for a limited duration—typically, up to 360 days for care received in a nursing home, assisted living facility, or at home. In many STC policies, facility care and home care benefits are treated separately, allowing for up to 360 days of coverage for each type of care. STC is specifically designed to fill the gaps left by Medicare or to serve as interim coverage for care needs that don’t meet the duration or severity required for traditional LTCI policies.
While STC benefits are shorter in duration, these policies often come with:
- Simplified underwriting
- Lower premiums
- Quicker approvals
- Daily benefit options similar to LTCI
Where STC Fits in the Planning Conversation
1. For Clients Who Don’t Qualify for Traditional LTCI
Underwriting for LTCI can be a dealbreaker. As agents, we often face hard stops when clients have chronic conditions. This is where STC can shine. With simplified underwriting (often yes/no questions) and fewer medical hurdles, STC can be a powerful fallback.
Use STC as a “Plan B” option for clients who are declined or rated up for traditional LTCI. It’s not full coverage, but it’s a meaningful layer of protection.
2. For Budget-Conscious Clients
Many clients want LTC coverage but balk at the cost. STC offers an affordable entry point, especially for those in their 60s or older who are concerned about early-stage care but unwilling to commit to a long-duration policy.
Present STC as a bridge strategy to cover short-term recovery periods or waiting periods on other policies, without breaking the bank.
3. To Bridge Medicare’s Gaps
Many clients mistakenly assume Medicare will pay for all types of care. In reality, Medicare only covers skilled care for a limited time and only under specific conditions. Once that benefit ends, clients are on their own. Short-term care insurance can fill that critical gap between Medicare’s coverage ending and when clients either recover or transition to longer-term solutions.
Use STC to help protect retirement savings during these vulnerable transition periods. It’s especially effective when paired with a Medicare Supplement strategy.
4. As a Layered Approach with LTC or Hybrid Policies
STC doesn’t have to stand alone. It works well as part of a layered care strategy, especially when:
- LTCI has elimination periods of 60-90+ days.
- Clients want to delay tapping into LTC or hybrid benefits.
- You want to protect family caregivers early in the process.
Think of STC as front-end coverage that buys time before bigger policies kick in.
Sales Opportunities: When and How to Offer STC
You’ll often find STC fits best in these client scenarios:
- Clients aged 60–79
- Moderate income and asset levels
- Already declined for LTCI or seeking an alternative
- Want home health care coverage without full LTCI cost
Frame it as a practical, immediate protection option. “If you fell and needed six weeks of rehab at home, what’s your plan?” That’s a relatable scenario that will help the value of STC click with many clients.
Why Agents Should Pay Attention to STC Now
- Rising LTCI rates and tightening underwriting are pricing many clients out.
- Increased demand for care at home creates opportunities for flexible policies like STC.
- Regulatory shifts and inflation are making shorter, more affordable policies more attractive.
Ignoring short-term care means leaving solutions and commissions on the table. It also means missing an opportunity to serve a broader segment of the market that still needs protection.
As agents, our role is to tailor the right solution to the right client at the right time. Short-term care insurance isn’t the whole answer but it’s a valuable piece of the puzzle. When traditional LTCI doesn’t fit, STC often can. And in many cases, combining both is what creates the most comprehensive, client-focused care plan.
Don’t wait until a client is uninsurable or panicked about a recent health scare. Start layering in STC as part of your broader care planning conversations and meet clients where they are, with solutions that fit.