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LTC Insurance Blog
Simplifying the process of understanding Long Term Care, and helping you decide if Long Term Care insurance is right for you.
How Long Will My Long Term Care Policy Last?
One of the biggest concerns when purchasing a Long Term Care policy is choosing how long you want the policy to last. Common options for benefit periods are two, three, four or five years. This can be a bit misleading. Your policy could potentially last longer than the benefit period you choose. This is because Long Term Care policies use a pool of money when paying out benefits.
For example, you may choose a policy which pays $200 per day for 5 years. To determine your policy’s pool of money, multiply the maximum daily benefit ($200) times 365 days (1 year) times 5 for a five year benefit period. You end up with a pool of money of $365,000. If you use $200 per day for care, your benefits would last for five years. If for example, you are only using $100 per day for care, the policy would last ten years. Here is the math. $100 per day multiplied by 365 days (1 year) multiplied by 10 years equals $365,000. Your pool of money is the same in both scenarios but depending on how much of your daily benefit is used for care, your policy could last much longer than the original benefit period specified in the policy. The pool of money would also last longer if you are not receiving care every day.
One major consideration you will need to be aware of is the average cost of care in your area. This will help you determine how much coverage you will need and how long your coverage can be expected to last. If you would like to speak with someone about the cost of care in your area or if you would like to receive a quote for Long Term Care coverage, please contact us at 1-800-432-0091 or fill out our online submission form for a free rate comparison.