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Last Updated January 16, 2014

Long Term Care Insurance Benefits

Most Long Term Care Insurance benefits can vary from one company to the next, but most all current plans have virtually the same core Long Term Care Insurance benefits.  However, some of the fine details can differ so we will go over some of those differences below.

Home Health Care

The top ten Long Term Care Insurance plans all offer 100% of your benefits for home health care.  However, many group Long Term Care plans you might buy at work do not offer 100%.  Often the group Long Term Care Insurance plans will reduce your home care benefits to 50-75% whereas a privately purchased plan will cost you less money and provide you 100% home health care beneits.

  • 75% of Long Term Care claims start at home. Don’t be fooled by group plans that charge you more money for reduced coverage.  Group plans typically only pay for 50-60% for Home Health Care services.

Facility Care: Nursing Homes & Assisted Living

The thing most people thing about when they think about Facility Long Term Care is nursing homes. However, Assisted Living is equally as popular.  Assisted Living facilites are less intensive and more welcoming than nursing homes.  Policies from the top ten long term care companies will provide you the flexibility to choose from a wide variety of care options when you need it.

  • Assisted Living: An apartment-like setting where you can put your own furniture in your room and enjoy privacy with the assurance of nearby help.
  • Nursing Home: Intensive care and generally “end of life” care where you need constant medical supervision.

Benefit Period: How Long Will You Need Care?

A core “moving part” in Long Term Care policies is benefit period.  Simply put, the benefit period is a main building block in calculating the value of your policy.  It’s something you choose when we start to design your plan.  Your options are 2, 3, 4, 5, 6, and 10 years, as well as unlimited (lifetime) coverage.

Money saving tip: 92% of all Long Term Care claims are for three years or less.  Odds are, a three year plan is sufficient for most clients.

Automatic Inflation Protection

Automatic inflation protection is the foundation of a good Long Term Care Insurance policy.  With compounding, your benefits can double, triple, or even quadruple over time giving you more money when it’s needed most.

See Also » How Does Long Term Care Inflation Work?

Elimination Period (also known as your Deductible)

The elimination period is the time that has to pass before the Long Term Care Insurance will begin paying benefits.  Most companies offer a 30-, 60-, 90-, or 180-day elimination period. The longer the elimination period the lower your premium will be.

Older policies required the elimination period to be consecutive days of care but modern plans are usually more friendly.  Days do not have to be consecutive and it’s a “once in a lifetime” deductible.

See Also » Calendar vs Service Days with Long Term Care Policies

Maximum Policy Value or Pool of Money

Your policy will provide a benefit maximum policy value.  Imagine this as a Long Term Care Insurance checking account – but the money can only be used to pay for Long Term Care Services.  Long Term Care Insurance policies refer to this as your “pool of money.”

A Long Term Care Insurance policy with a pool of money will allow you to stretch the benefit years if you do not take out the maximum daily or monthly amount.  For example, a $100/day policy for 3 years has a maximum value or pool of money totalling $109,500.  If you regularly pulled out $100 a day each and every day, you could exhaust the policy.  However, if you pulled out less, say $50/day, your policy would last as long as 6 years because you were pulling out half the daily amount.

Under the Indemnity Long Term Care Insurance Payment option, the Long Term Care Insurance company will send you a check for the policy’s full daily or monthly benefit, regardless of whether or not the actual expenses were less.  If there is money left over,  then you can spend it anyway you see fit.

Shared Benefit Coverage for Couples

Shared Long Term Care Insurance benefits are an optional rider that allows couples to share each other’s benefits.  If one spouse needs Long Term Care and runs out of money in their policy, they then can dip into their spouse’s policy and use their benefits.

Waiver of Premium Long Term Care Insurance Benefits

When the time arrives for you to need Long Term Care, the last thing you want to worry about is paying the premium for your policy.  Plans from the top companies will waive your premium once you begin receiving benefits.

Return of Premium Long Term Care Insurance

This benefit is a rider some companies offer that will return all or a portion of the Long Term Care Insurance premiums paid back to your beneficiary at your death (less claims).  There are different options available with this rider depending on the company, so be sure to ask questions and look at several companies.

Survivorship Long Term Care Insurance Benefits

This Long Term Care Insurance rider is for couples.  Depending on the option, when either 7 or 10 years pass, if no claims have been paid when one spouses dies, then the other spouse has full benefits and never has to pay premiums again.

Long Term Care Insurance Underwriting

Long Term Care Insurance qualification is different from life and health insurance qualifications.  When underwriters decide whether or not to issue a life or health insurance policy, they consider factors such as current physical health, health history, lifestyle, occupation, and avocations.

Long Term Care Insurance underwriters also consider current cognitive health.  When applying for Long Term Care Insurance, buyers should expect a customary medical questionnaire as well as a professional assessment of their cognitive facilities for any possible signs of cognitive impairment.

Cognitive disorders such as Alzheimer’s and dementia are major contributors to nursing home admissions and Long Term Care Insurance claims.  These conditions are watched and studied by underwriters closely.  The Long Term Care Insurance underwriter’s main goal is to filter out applicants who pose a high risk of requiring Long Term Care.  It is beneficial to buy from a company that does a good job in the underwriting process because if the company insures too many higher risk people, then those people will file claims and cause your premiums to increase.

Coverage and features on Long Term Care Insurance policies vary from company to company, so it is important to shop around and look at several carriers.  LTC Tree works with all of them.  Simply fill out the form below, and we will mail your quotes to you the next business day.

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