Understanding Waiting And Benefit Period In Long Term Care Insurance
Before you purchase a long term care insurance cover, you need to consider two very important aspects. These include: waiting period and the benefit period. The waiting period is the time when you claim the policy till the time you actually get the benefits amount. In the insurance parlance, it is also called the deductibles. Another important aspect that needs to be considered is the amount of time the insurance company agrees to pay the benefits. This is called the benefit period.
Both waiting period and benefit period varies from one company to the other and also differs in case of individual policy. Therefore, it is important to have a comprehensive knowledge of both these concepts stated in your policy, so as to avoid confusion at a later stage.
The waiting period
Once a person buys a long-term care insurance cover, he has to wait for a number of days/months to get the benefits of the cover. During this period, it is expected that he should manage his own expenses. This is true in case of all other healthcare insurance policies as well.
You should choose a policy based on the waiting period on your cover apart from other benefits. You would hardly come across any insurance company offering a zero-day elimination period. In case of long-term care policy, the period could be one month, two months, six months and even a year, depending on the insurance company and the type of policy you choose. Generally, the longer the waiting period, the lower will be the price of the policy in case of long-term care insurance.
However, experts also believe that longer waiting period that entails lesser premium would in the long run affect your policy premiums. At the same time, a very short waiting period will cost you much more in terms of paying the premium. Therefore, it is generally considered that the most reasonable waiting period can be for the duration of 60-90 days and it is worth the wait because the duration is not that long.
The benefit period
The other important aspect of long term care policy is the benefit period. It is important for the policy holder to understand for how long the insurer will pay the benefits. A limited benefit period would not be valuable to the policy holder, especially if he has opted for a long waiting period. However, you need to consider how much you can afford for the cover. Policies that offer lifetime benefits generally charge a higher premium.
It has been observed that it is a good deal if an insurer offers to pay benefits for at least five to ten years in most cases. However, the number again varies based on your needs and budget.
After all, the purpose of long-term care during the old age when other facilities are not much applicable is to provide proper extended care. If budget is not the key constraint, it is often recommended that even though the waiting period can be a bit longer, but given a choice, one should choose a policy that offers a lifetime benefit period to the policyholder.