Common Aspects of an LTC Policy
The Financial Strength of an LTC Policy is one of its most important components. You want to be sure that the benefits of your policy are adequate and that they will pay out for a long enough period of time. You don’t want all your premiums to be for nothing if as you age you have less money for Long Term Care.
Different parts of the country and different facilities have varying daily costs. Because Insurance companies compute benefits based on daily needs, make sure that you have adequate daily benefits in your policy. $130 is the average cost of one day in a nursing home, with prices reaching $200 in metropolitan areas.
Inflation can wreak havoc on any long-term financial plan, and Long Term Care Insurance is no different. Assuming a 5% annual rate of increase, in 14 years $130 a day for Long Term Care can double to $260. Make sure your plan has some protection against inflation.
Understanding the claims process is the first step towards having full control and understanding over your policy. Find out the actual procedure of your insurance provider, and be sure to find out which claims actually are paid, as well as how many.
Your premiums are determined at the purchase of your policy, but they can increase. While you as an individual will not see a rate increase, your entire class of premiums might. When you purchase your policy, find out how your provider handles rate increases and if you could be subject to one.