Home > Glossary > Long-term Care Insurance

Meaning / Definition of

Long-term Care Insurance

Categories: Insurance,

long-term care insurance is a policy designed to cover at least some of your expenses if you have a chronic but not life-threatening illness, long-term disability, or you are unable to live independently because you can't perform a number of the activities of daily living. Those activities typically include bathing, dressing, feeding yourself, taking medication, using the bathroom, and being able to move from a sitting to a standing position. Most contracts also cover cognitive impairments, such as Alzheimer's disease.Under the terms of most long-term care contracts, you can be cared for in a nursing home or at home. The insurance pays for custodial rather than skilled care, which must be provided by licensed professionals. That care is covered in part by Medicare and Medigap policies. Every policy provides a specific daily or monthly benefit for up to a predetermined benefit period. Each policy also has an elimination period, which lasts from the day you become eligible until the day the insurer begins to pay. You generally can choose the benefit, benefit period, and elimination period that makes the most sense to you and that you can afford.

Featured term of the day

Definition / Meaning of

Inflation-adjusted Principal

Categories: Bonds and Treasuries,

The net worth of a principal amount used to buy inflation-adjusted securities, taking into account any inflation that takes place till the maturity date. The new value of the principal is derived by multiplying the original principal amount by the inflation index ratio.P(adj) = P(ori) x ( CPI(cur) / CPI(ref) )Where, P(adj) = the net worth of the principal value after inflation adjustment; P(ori) = the original amount of principal used to buy the security ; CPI(ref) = the inflation level at the time the bond is first issued (usually taken from 3 months before the bond is issued) ; CPI(cur) = the inflation level at the current period of the bond maturityFor example, an investor buys a $2,000 Treasury inflation-adjusted bond in June. The CPI reference rate is taken from March's CPI (three months earlier), which is, for example, 100. Six months later, inflation has risen 1% and the current CPI is now 101. This will yield an inflation index ratio of 101/100, or 1.01. At the end of six months, the bond's adjusted principal is now worth $2,020, or 2,000 x 1.01.

Most popular terms

1. Motor Vehicle
2. Relative Strength
3. Homeowners Policy Special Form 3 (HO 3)
4. Risk Manager
5. Weather Derivative
6. Continuous Net Settlement
7. Floating Excess Policy
8. Gramm-Leach-Bliley Act
9. Inflation-protected Security (TIPS)
10. Discrimination

Search a term

Keyword:

Browse by alphabet

ABCDEFG
HIJKLMN
OPQRSTU
VWXYZ#

Browse by category

Accounting
Banking
Bankruptcy Assistance
Bonds and Treasuries
Brokerages
Business and Management
Compliance and Governance
Credit and Debt
E-commerce
Economics
Estate Planning
Forex
Fraud
Fundamental Analysis
Futures
Global
Insurance
International Trade
Investing and Trading
Ipos
Legal
Loan and Mortgage
Mergers and Acquisitions
Mutual Funds
Operation and Production
Options
Patent
Personnel Management
Real Estate
Retirement and Pension
Statistics and Risk Management
Stocks
Strategies
Tax
Technical Analysis
Venture Capital