Long term insurance, more commonly long term care insurance, is an insurance policy that people take out to cover any costs that they might incur to live in their old age. This could include costs of assisted living homes or nursing homes or costs such as needing special geriatric equipment. The insurance is a way to provide for these extremely high expenses, especially at a time when the person is retired and out of any option of earning a regular income as in younger days.
So, what does long term care insurance cover and what does it not? Here are some points.
This type of insurance is basically sought to help people with their daily living activities when they grow older. There are 6 such activities defined by insurance companies. They suggest that if a person is not able to carry out the 6 tasks of (i) eating (ii) using the bathroom (iii) wearing clothes (iv) movement (v) maintaining self-hygiene and (vi) being continent, then any expenses that are incurred on these counts can be covered by the long term insurance policies.
If the individual needs special care and accommodation, such as needing to be put into a special care home for the aged, then those expenses are covered by such policies.
Special nursing help that may need to be hired at the residence of the person is also covered. This includes nurses, attendants, servants, caretakers and the like. The only important condition is that the person employed must perform only those tasks that are needed to assist the person with the daily living activities mentioned above. For instance, if a servant looks after the insured person but then also looks after the house and gets paid for it, then those costs may not be covered by long term care insurance policies.
Any special adjustments that need to be done in the living place of the insured will be covered for, if these adjustments are needed to help the person with their daily living activities. For example, fitting a mobility ramp or installing a walk-in bathtub are things that this policies would cover.
Special equipment that needs to be bought in order to help these people with their daily living activities is also covered. A wheelchair, for example, will be covered. The same applies to walking sticks, certain aids such as visual and auditory aids, etc., though not all policies might provide coverage for all of these things.
There are certain geriatric requirements that these policies won't cover. The thing that needs to be remembered here is that these policies are not health policies. Hence, they are not meant to cover any medicinal or hospitalization costs. For these, the person would need to take out a health policy. The long term care policy is only meant to help old people perform their daily living activities. Having said that, it is important to mention that the coverage included in each policy can be different, depending on what is sought. Mutual solicitations between the insurance provider and the insured are possible.
It is also important to know that all long term insurance policies have an upper limit. They will pay out a particular dollar value per day, and not above that. Hence, the coverage provided by these policies isn't unlimited.