What is the difference between “Reimbursement,” “Indemnity,” and “Disability” type policies?
A reimbursement policy, also known as an “expense-incurred policy,” is the most common type of policy currently purchased. To prove benefit eligibility you are required to meet the ADL or severe cognitive impairment benefit triggers as indicated in your policy. You will receive benefits only when eligible services are received; benefits are paid directly to you or to the provider. This type of coverage pays for the expense incurred or up to your policy’s monetary limit, whichever is less. Unlike a reimbursement (expense-incurred) policy, benefits paid by an indemnity policy are a set dollar amount. Benefit eligibility is generally the same as for a reimbursement policy. When eligibility is established and you are receiving covered long-term care services, the insurance company will pay the pre-determined daily benefit amount indicated in your policy on days you receive a covered service. A disability type policy will pay a flat dollar amount on any day that you are determined to be eli