3 Reasons to Love Indemnity Policies


3 Reasons to Love Indemnity Policies

Indemnity or reimbursement – that is the question. For long-term care policies, traditional reimbursement policies pay benefits based upon the actual expenses you incur. An indemnity policy, however, pays you a monthly CASH benefit, regardless of expenses incurred.

As you may have guessed by the title, there are three reasons why I love indemnity policies.

  1. You don’t have to keep track of receipts. Now, I don’t know about you, but I can barely keep track of my tax papers, let alone every medical bill or receipt I would be required to keep track of for long-term care.
  1. You don’t have to use a qualified provider. Aunt Susie can come over and help! I would much rather it be Aunt Susie seeing all my business than some guy who looks like my mailman. No thank you!
  1. Money, Money, Money, Moneyyy! What better way is there to dip into the carrier’s pocket faster? Cash can be used for care, travel expenses, prescriptions, medical equipment, meals – whatever you want!

Case Study

  • 65-year-old female, married
  • $5,000 monthly benefit, 6-year duration, no inflation
  • She goes on claim but only needs $2,000 a month for care; after two years, she passes away
  • With a reimbursement policy, her spouse would be reimbursed her care costs: $48,000
  • With an indemnity policy
    • If she received the same care as above, her spouse would pocket $72,000 cash after her bills are paid
    • Keep in mind she can receive care from Aunt Susie; because she is family, she doesn’t charge as much. The spouse could net $120,000.

I know every situation is different, but so many people see the big number on the paper and think a reimbursement is the way to go. Just make sure you have all the facts. If you don’t – Just Ask! Use my calendar link to schedule a time that’s convenient for us to talk.