Your Parents May Already Have a Long-Term Care Policy. You’ll Be the One Filing the Claim, So Find It Now
Most adult children have no idea their parents carry a long-term care policy, and that gap becomes a crisis the moment someone needs to file a claim. Here is what a financial expert says families need to locate before a…
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Adult children often assume they would know if their parents had bought long-term care insurance. Noah Doyle, CEO of SoundRidge Private Wealth, told Kiplinger that a key piece of information to clarify is whether aging parents have a long-term care policy in place, because elderly parents often have a policy but don’t share that information with their adult children.
If your parents are still healthy and handling their own bills, you’re in the best window to act. Nothing is urgent yet, which is exactly why this is the right time to ask.
Why the Claim Paperwork Will Land on Your Desk
Doyle’s advice is blunt and practical: “You need to know what the policy number is and understand what the benefits are because if there’s ever a time when your parents have to use this policy, it’s the children who are going to actually file the claim and know what the care options are.”
Long-term care policies get used when a parent can no longer manage daily life alone. That is also the moment they are least able to dig through files, call an insurance company or explain what they bought years ago. The person who purchased the coverage and the person who files the claim are usually different.
A policy nobody can locate delivers nothing. Your parents may have paid premiums for years, and the value of that coverage depends entirely on someone knowing it exists when care starts.
Where Insurance Sits in a Family CFO Audit
Kiplinger lays out six steps to acting as a family CFO, and the insurance review falls inside the second one. Insurance is one of the categories in the audit step, alongside account access, cash flow and legal documents, and the article lists life, health and long-term care policies together.
Life and health coverage tend to come up naturally in family conversations. Long-term care coverage is easy to miss because it sits inactive until a crisis. If you are already asking about Medicare supplements or life insurance beneficiaries, add one more question to the same conversation (we put the full estate paperwork checklist, beneficiary forms and account titling included, in a free guide here).
No Policy on File? Run the Asset Test Next
The answer might be no. Doyle addresses that branch too. If there’s no long-term care policy in place, the family CFO has to analyze the parents’ assets to determine whether they have enough to cover long-term care, and if so, the most tax-efficient ways to raise the cash to pay for it.
This is the core tension for families without coverage. Two separate questions follow in order:
- Sufficiency: Do your parents’ savings, investments and other assets stretch far enough to pay for care if they need it?
- Sequencing: If the money is there, which assets get used first so the family keeps as much as possible after taxes?
Answer the first question before the second. Tax efficiency only matters once you know the assets can carry the load. The specific accounts and strategies depend on what your parents own, and that inventory comes from the rest of the audit.
A Role That Demands Real Hours
Overseeing long-term care is explicitly part of the family CFO’s broad range of money-related responsibilities, alongside estate planning. The job is time-consuming and can be difficult depending on the parents’ situation.
Start early. An hour spent gathering documents while everyone is healthy saves days of struggling later.
Get These Details in Writing While Your Parents Can Explain Them
The single most valuable step is simple: find out whether the policy exists. Then capture the details that make a future claim possible:
- Ask the yes-or-no question directly. Does either parent own long-term care coverage, including any rider attached to a life insurance policy? A plain question avoids guessing.
- Record the policy number and the insurer’s name. Doyle singles out the policy number specifically, since that is what you will need on the first call to file a claim.
- Get the benefits explained in your parents’ own words. Ask what they understood they were buying, then compare it to the written benefit summary so you know what care options the policy supports.
- Store a copy where you can reach it. Keep the documents with the other audit materials, such as account access and legal paperwork, so everything lives in one place.
The costly mistake is waiting for a health event to bring the subject up. By then, the parent who bought the policy may be unable to explain it, and you will be filing a claim on coverage you have never seen. Have the conversation now.
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Jake has been been working in financial media for almost 15 years. He focuses on all things personal finance for 24/7 Wall St. with high hopes to educate and entertain. Most recently, Jake spent 12 years working various roles at The Motley Fool. He started copy editing fool.com content, worked on premium and marketing campaigns, and helped launch The Ascent, a personal finance brand.
His work has been featured on platforms like MSN, Yahoo Finance, USA Today, and more. He's written about credit cards, social security, ETFs, savings accounts, and just about anything else you can imagine when thinking about money. Jake love to cook, play golf, and tell people he's never had a cavity. (It's true!)
