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.
- 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.
- 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!
- 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!
- 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.