Long-term care checklist
Elimination period, inflation protection, how it pays. Seven things that change the outcome if you check them first.
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Care coverage is one of the most important safety nets you will buy, and the terms differ enormously between products. Getting the benefit you expected, in the form you expected, depends on what you check beforehand.
Start with what is covered
Check that the plan covers the kinds of care you would actually want, and look at the support services too. They matter more than people expect when the time comes.
- Home care
- Assisted living
- Adult day care
- Nursing home
- Hospice
- Care coordination
- Caregiver training
- Respite care
- Bed reservation
- Care abroad
The seven checks
- Premium against benefit Balance a premium you can carry for years against a benefit that will actually cover the cost. Single premium, ten-pay and lifetime pay all suit different situations.
- The elimination period The wait between qualifying and the money starting. Ninety days is typical; it ranges from none to 180, and shorter costs more.
- Inflation protection Care inflation is fast. An amount that looks generous today can be thin in fifteen years, so an escalating benefit deserves serious thought.
- Paid-up coverage If premiums become difficult, this keeps a reduced benefit in force rather than losing everything paid so far.
- Reimbursement or indemnity Claiming against receipts, or receiving a set amount on diagnosis. The difference in how freely you can use the money is large.
- Waiver of premium Once you are claiming, this stops the premiums. It removes a real burden at exactly the wrong moment to be carrying one.
Complex, and worth it
Understanding what each of these actually means, then designing around your situation. I stay with it from the first question to the policy.
Coverage, triggers and premiums vary widely by product. All require health underwriting, and the healthier you are the better the terms.
