People who buy long term care insurance (LTCI) should treat their long term care elimination period with utmost importance as this component was not meant to simply accessorize a policy.

Like the maximum daily and monthly benefit amount, benefit period, and inflation protection rider, one’s choice of elimination or waiting period will greatly affect the annual premium of his coverage. Choosing a longer elimination period is tantamount to a smaller premium while a shorter one is equivalent to a higher premium rate.

Based on research, the elimination period of an LTCI policy will take effect after the policyholder has met a benefit trigger and a licensed health care provider has issued a certification of his inability to perform two or more of the six activities of daily living (ADL) which are eating, bathing, dressing, transferring, continence, and toileting.

An insured person’s choice of waiting period will not only directly affect the premium of his coverage but also his nest egg. While a longer waiting period will cut down his premium, it will on the other hand subject him to large out-of-pocket LTC expenses.

Meanwhile, an LTCI policy with a shorter elimination period will cost more in premium but require lesser out-of-pocket expenses.

In the assessment of his elimination period, an individual has to take into consideration his cash in hand. If he has more than $100,000 in the bank then it is reasonable for him to opt for a 180-day elimination period or even one year. However, if he has barely $80,000 in assets then he’s better off with a shorter waiting period otherwise he could outlive his resources.

Long Term Care Elimination Period

Based on a study which was conducted by LTCI experts, the most ideal waiting period is 90 days because it is neither too long nor too short.

However, it is very important that an LTCI policyholder understands the provision of his policy’s waiting period because insurance companies vary in this aspect.

For example, one insurance company may require the insured person to acquire care continuously up to the end of his elimination period. Meaning to say, a day with no care can drastically change his eligibility for benefits.

Meanwhile, there are LTCI carriers that do not care how often the policyholder receives care for as long he accomplishes his waiting period. Once he has done so his LTCI benefits will just start coming to him.

For one to be able to identify his policy’s waiting period he simply has to be able to point out what he will need in the future, study the cost of care in his area and keep abreast of the figures. By monitoring the current LTC costs, one will be able to calculate his future cost on care.

Your elimination period can strengthen or weaken your finances so see to it that you analyze your options carefully before deciding which one to go for. Remember that your eligibility for your LTCI benefits is dependent on your waiting period.

For further information about long term care elimination period, speak with your LTCI specialist.

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