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provides for the insured in the event that they need some form of long- term care, and it comes in a variety of forms. This allows the purchaser to determine better which coverage would best suit his or her needs.

Long-term care insurance will cover a variety of services. These include skilled nursing home care, intermediate nursing home care, custodial nursing home care, other custodial facility care, in-home health care, in-home care, adult day care, respite care, and hospice care. With all these choices, it’s easy for an individual to pick a pol- icy that will be the best suited for his or her anticipated needs. Since most people say that they don’t want to go into a nursing home, pur- chasing a policy that covers in-home care gives you the flexibility of staying in your home.

This kind of insurance can cover different time periods. Gener- ally, you can choose from two, four, or six years’ worth of coverage, or you can opt to be covered for your entire lifetime. While at face value, lifetime coverage may seem like the most desirable, it is very expensive and most people never use that much coverage. The amount of time you choose constitutes the maximum coverage period. But, if you don’t want to put a time limit on your coverage, you can choose to institute a maximum dollar amount. That sets the amount of money that the insurer will pay in benefits over the life- time of the insured. Depending on personal preferences, one may be better than the other. However, I have found that the time limit option is the best because the cost of coverage continues to increase, thus diminishing the overall effectiveness of the maxi- mum dollar option.

The insurance benefits can be paid in one of two ways. First, the policy may pay the expenses as they are actually incurred. That is, if your long-term care costs are $137.50 per day, your policy would pay $137.50 per day. These are called expense reimbursement policies. The other way benefits are paid is on a per day basis. These policies, called per diem policies, pay a stipulated daily amount. So, if your cost is $137.50 per day, and your policy had a maximum daily bene- fit of $125, you would have to pay $12.50 per day out of your pocket.

This daily benefit will also pay for any in-home care, as long as you elect for that option when purchasing the policy. Again, you have choices regarding the amount of in-home care the policy will

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