Benefit Period

The benefit period specified in a long term care insurance contract is used to calculate the plan’s initial maximum lifetime benefit amount. It does not define the length of time that benefits can be paid to an eligible insured. As long as the total amount of benefits paid does not exceed the maximum benefit amount, benefits will continue to be paid. For example, a plan that provides a monthly benefit of $5,000 for nursing home care and 75% for home care, with a six-year benefit period has an initial maximum lifetime benefit amount of $360,000. Under such a plan, an insured could receive home care benefits for 8 years ($5,000 x 75% x 96 months = $360,000), even though the benefit period is stated as six years. Note that long term care insurance policies that offer lifetime (unlimited) benefits have no lifetime maximum benefit amount.