The purpose of Long Term Care Insurance is to cover the cost of caring for yourself when you are no longer physically able to do so.
To qualify for a claim typically you must no longer be able to perform two of the six primary aspects or activities of daily living: bathing; dressing; feeding yourself; using the toilet; getting out of bed or a chair; continence or keeping bladder and bowel control.
Generally plans are structured to provide a weekly income. Some plans limit the length of benefit payments to a maximum of 250 or 500 weeks.
Scenario
John purchases Long Term Care Insurance after deciding that if he were no longer able to care for himself he would like to be cared for in his own home. This was an option his elderly mother had not been able to afford and he had always been regretful of that. Her final years were spent in a long-term care facility far away from the community where she had spent most of her life. At age 73 John’s health situation was such that he qualified for and required care. Accordingly John was able to augment his retirement income with a $600 per week Long-Term Care benefit that would continue for the rest of his life. John was able to use this money to carry out his wishes of being cared for in his own home.