Long Term Care Insurance Center

Long Term Care Insurance Q & As

Question 13 of 19 in Features Of A Typical Policy
Inflation rider
Cost of living riders address the ever-inflating cost of care. Typically, they are stated as annual increases of 5% -- either simple or compounded. If benefits start at $100 per day in the first year, under simple interest they will be $105, $110, $115, $120, $150 in the 1st, 2nd, 3rd, 4th, and 10th years, respectively. Under the option to compound, they would be $105, $110.25, $115.76, $121.55, $162.89 in the 1st, 2nd, 3rd, 4th, and 10th years, respectively.