The elimination period in long term care insurance refers to the waiting period before the insurance benefits start to be paid out. During this period, the policyholder is responsible for covering their own long term care expenses. The length of the elimination period can vary depending on the policy, but it is typically measured in days or months. The purpose of the elimination period is to prevent individuals from purchasing insurance coverage only for short-term care needs. By having a waiting period, insurance companies can ensure that the policyholder truly needs long term care and is not just seeking coverage for a temporary situation.
During the elimination period, the policyholder will need to pay for their own care expenses out of pocket. Once the elimination period is over, the insurance benefits will kick in and start covering the eligible long term care expenses. It's important to note that the elimination period is not the same as the deductible. The elimination period is a waiting period, while the deductible is the amount that the policyholder needs to pay before the insurance benefits start to be paid out.
The length of the elimination period can vary depending on the policy and the individual's preferences. Some policies offer a range of elimination period options, allowing the policyholder to choose a shorter or longer waiting period based on their needs and budget. A shorter elimination period will result in higher premiums, while a longer elimination period will typically result in lower premiums.
It's important to carefully consider the elimination period when choosing a long term care insurance policy. Factors to consider include your financial situation, the availability of other resources to cover care expenses during the elimination period, and your risk tolerance. If you have sufficient savings or other sources of income to cover your care expenses during the elimination period, you may opt for a longer elimination period to lower your premiums. On the other hand, if you prefer to have the insurance benefits start sooner, you may choose a shorter elimination period, understanding that it will result in higher premiums.
In summary, the elimination period in long term care insurance is the waiting period before the insurance benefits start to be paid out. It is designed to ensure that the policyholder truly needs long term care and is not just seeking coverage for a temporary situation. The length of the elimination period can vary, and it's important to consider factors such as your financial situation and risk tolerance when choosing a policy. A shorter elimination period will result in higher premiums, while a longer elimination period will typically result in lower premiums.