I'm posting this because maybe it will help someone. I thought after reading my hb's policy a million times I completely understood it, but yesterday I got a (good) surprise. The policy has an inflation rider that states the original monthly amount increases by 5 percent annually. OK, but I didn't realize, that kicked in when the policy was taken out, not when he actually started receiving benefits. Makes sense, I had just never concentrated on that issue. Only reinforces the fact that we really need to understand all the details, especially when purchasing or comparing LTC policies.
When we took out our policy fifteen years ago we had no idea what provisions we should be looking for. It turns out that the policy has a cap and will pay 80% of the minimum daily fee of 160.00 if we activate for antything other than a full time nursing home for which they pay 100%. Home health care workers, ALF's and respite come under the 80%. It's something but not what we thought we were buying.
Marilyn, good provision to point out. Most LTC policies offer the inflation provision when you sign up. However if you decline the inflation provision (your premiums also increase with the inflation increase) then the LTC company may not offer the opportunity again to participate in the inflation provision in the future. My sister declined the inflation provision; the company offered it again 4 years later. She was able to get the inflation provision but at the original rate (5%), she missed out on the compounding she would have had if she took it originally and then the next increase. Yes, you really have to read the policies - they are written so most people can't fully understand what they are purchasing.
I wish now that I had gotten the inflation rider. My policy will pay for 50 months of care that is another thing to look at is how long they will pay out. I did get the option to extend the payout for a liftime. The maxium monthly benefit after the 50 month drops on my policy, but only $75.00 less per month. There are also some policies that limit the daily amount, my policy only has a monthly limit which is more flexible and allows me to have 24 hour care if I need it, but the monthly benefit is not enough to pay that for a full month it will cover 200 hours a month which is plenty now but will not be enough later, but perhaps hospice will kick in at that point.