Coverage & Benefits Choices

Many long-term care insurance policies have limits on how long or how much they will pay. Some policies will pay the costs of your long-term care for two to five years.

Some insurance companies offer policies that will pay your long-term care costs for as long as you live—no matter how much it costs. But there are very few companies today that offer such unlimited or lifetime policies. However, some companies do have a “high coverage option” which might offer a $1 million lifetime limit.

Most policies sold today are “comprehensive” policies. They typically cover care and services in a variety of long-term care settings including:

Your home
Adult day service centers
Hospice care
Respite care
Assisted living facilities (also called residential care facilities or alternate care facilities)
Alzheimer's special care facilities
Nursing homes

In the home setting, comprehensive polices generally cover these services:

Skilled nursing care
Occupational, speech, physical, and rehabilitation therapy
Help with personal care, such as bathing and dressing

Many policies also cover some homemaker services, such as meal preparation or housekeeping as long as it is in conjunction with the personal care services you receive.

When you start receiving benefits is based on the policy’s “benefit trigger,” the length of the elimination period you choose, and sometimes when you start receiving paid care. Benefit triggers are the criteria insurance policies use to determine when your long-term care begins. Usually, the benefit triggers are defined in terms of Activities of Daily Living or cognitive impairments. For example, most policies pay benefits when you need help with two or more of six Activities of Daily Living or when you have a cognitive impairment.

The “elimination period” is the amount of time that must pass after a benefit trigger occurs but before you start receiving payment for services. An elimination period is like the deductible you have on car insurance, except it is measured in time rather than by dollar amount. Most policies allow you to choose an elimination period of 30, 60, or 90 days. During the elimination period, you must cover the cost of any services you receive. Some policies specify that in order to satisfy an elimination period, you must receive paid care or pay for services during that time.

Once your benefits begin, most policies pay your costs up to a pre-set limit. Other policies pay a pre-set cash amount for each day that you meet the benefit trigger whether you receive paid long-term care services on those days or not. These “cash disability” policies offer more flexibility but are much more expensive.