Long-term Care Insurance benefits
Knowing what the benefits of long-term care insurance might be can help
you determine whether it’s right for you and your family. These benefits include:
-
Giving you the flexibility to participate in deciding where to get care and who
provides it
-
Helping protect your retirement savings by letting you use them for what it was
originally intended – enjoying retirement
- Helping protect the family from providing all the care
Basic components of Long-term Care Insurance
-
Benefit Amount: This is the maximum amount of expenses covered in
any single month or day. Benefit amounts vary by plan.
-
Benefit Period: This is the minimum number of months the coverage
will pay benefits for covered expenses.
- Total Benefit Amount: The total benefit
amount is determined by multiplying the monthly benefit amount by the benefit
period. These are the funds that are available for covered care. For example, to
determine a monthly benefit amount of $5,000 with a four-year benefit period,
multiply $5,000 (benefit amount) x 48 months (the benefit period 4 x 12 months). The
total amount of benefit dollars available is $240,000.
- Inflation Protection: This is an optional
feature available on some plans. Generally it increases the monthly maximum to help
ensure the policy keeps pace with the increasing costs of care.
- Elimination Period: This is the amount of
time that must pass before the benefits will become available. Just like a
deductible, this is the out-of-pocket expense. The shorter the elimination period,
the higher the premium will be.