Base Your Policy’s Benefit Amount on the Right Factors
Buying a long term care insurance policy requires consideration for this product’s four major components which are the long term care insurance benefit amount, maximum benefit period, elimination period, and the inflation protection.
If you disregard even just one of these components you put your coverage on the line. Before you can determine the variable to match each component of your long term care insurance (LTCI) policy you have to be able to clearly define it first and identify its determining factors.
For example, the daily benefit amount of your LTCI policy refers to the maximum amount of benefits that your insurance will pay out to you every single day after you have satisfied your policy’s elimination period.
In determining the amount of benefits that you’ll be needing from your LTCI policy you need to study the cost of care in your area first. Although LTCI carriers and brokers are capable of providing the average cost of care in every state, some cities have greater long term care (LTC) costs while in other places the cost of care is lower.
If you would just base your research on a state’s average annual cost of care you could either run short of benefits or overspend on the premium of your policy. So take time to go around your city and check out the annual rates of home health aides, nursing homes, assisted living facilities, adult day care health centers, and other LTC services.
Long Term Care Insurance Benefit Amount
Perhaps you’re wondering why you should check the rates of all types of LTC facilities in your area of residence when you can just go to your preferred setting. The reason behind this is that most people require more than one form of care.
For instance, an insured individual purchased a comprehensive policy which stipulates full coverage for in-home care and only 50% for nursing home care thinking that he won’t need the latter. Upon qualifying for his insurance benefits, he only managed to receive sox months of home care because his health condition deteriorated so quickly that he had to be brought to a nursing home.
Unfortunately, the cost of nursing home care is twice the cost of in-home care so the family of the insured had to use the latter’s assets down to the last penny to be able to cover all of the expenses that he has incurred in the nursing home. In short, his policy did not serve its purpose because he spent a longer time in a nursing home.
By considering the cost of multi-level care in your area you can prevent such occurrence.
You don’t necessarily have to consider all forms of LTC to be able to decide on your long term care insurance benefit amount. Simply open your mind to the possibility of requiring a lower level of LTC at the onset of care and a higher form of care afterwards. LTC planning, after all, is anticipation of what could happen in the future so it’s quite logical to prepare yourself for the worst case scenario.
We shop from all the major private carriers and give you free long term care quote. We also offer all the important information and updates about CLASS act.
Processing your request, Please wait....
