Types of Long Term Care Insurance

Generally, long term care insurance works by providing coverage for long term care needs. However, there are different types from which you can choose from. These types differ in how they pay off claims but not in the range of their coverage and benefits.

Indemnity Long Term Care Insurance

An indemnity policy gives you full control on how you will manage your benefits by paying off the maximum benefit, regardless of how much was actually incurred. Say, you have utilized $1,125 worth of care expenses in a month but your policy entails that your monthly maximum benefit amounts to $2,500. You can use the remaining $1,375 for other things such as bills payment or even savings.

Reimbursement Long Term Care Insurance

A reimbursement policy is the conventional type of long term care insurance. As opposed to an indemnity policy, this only pays for the exact amount of your care expenses. What remains off your maximum daily benefit will remain in your pool. Say your maximum benefit is $250 per day in a nursing home, but your bill amounted to just $150, you will only be reimbursed for that amount. The unused $100 can be used for future claims.

Partnership Long Term Care Insurance

A partnership policy is a collaboration between an insurance company and the state. Should you use up your insurance coverage ahead of time, a partnership policy will allow you to qualify for Medicaid without the traditional low asset criteria. This is because of its primary feature which is the Medicaid Asset Protection.

To get the most out of your policy, study how each type works and go for the type that can best cater to your needs.