One of the major features of a long term care policy is referred to as the "benefit amount". This is the sum of money that long term care insurance pays out for the person’s care after the policyholder completed or passed the elimination period. This determines policyholder’s choice on how much he would like his policy insurance to pay out to him in benefits at the time of claim. When looking at the long term care insurance policy, benefit amount is one of the most important decisions to make. The amount can be either daily or monthly.

The daily benefit amount is simply the benefits given on a daily basis by the policy owner’s insurance. Policy holders can choose daily benefit amount ranging from $50.00 to more than $300.00 for nursing home coverage. Policyholders however are responsible for the actual nursing home or living facilities costs that exceed the daily benefit amount purchased. On the other hand, a monthly pay benefit is given monthly. Since home care expenses are not the same from day to day, more of the newer policies in the marketplace offer the latter. It can sometimes involve higher cost but the difference is that instead of being limited for example at $100.00 a day, you have access to $3000.00 a month if you need it. You may need $200.00 worth of services on one day and only just $50.00 the next day. Monthly benefit amount is more flexible.

Policy owners should be updated on the current prices of nursing home or assisted living facilities in their area at the time of claim to avoid confusion in determining the right amount for the benefit period. The national average daily cost for nursing home and assisted living facilities is $200.00 or higher per day. In the northeastern part of the country and major states such as Texas, California, and Washington, it can be more than $300.00 daily. Say for example, a policyholder lives in Florida where the average cost of care is $190.00 daily but planning to move to New York on the time he needs the care, it is better to take advantage and buy the $380.00 per day benefit since nursing home and assisted living facilities in that state are more expensive.

Keep in mind that long term insurance premium is directly related to long term care insurance benefit amount that policyholder choose. The benefit amount should complement the expenses for the actual care. For example, in the event that care is needed and the policyholder requires more money from the insurance company it will basically result to a higher premium payment for policy. The higher benefit amount means higher LTCi premiums. Thus, policy owner’s benefit amount choice should be given extra consideration since every person has different needs when it comes to long term care. Assessing your needs and health first before deciding on the amount makes a lot of sense. It’s not wise to rush in deciding for the cost of benefit amount. Researching first the current nursing home or living facilities cost that might affect the premium or seeking advice from financial or LTC insurance expert is a good idea. Benefit amount should be chosen carefully to avoid costly mistakes. It’s no good to pay less than or more than the actual needs.