What percentage is typically included in a long-term care policy for annual inflation protection?

In many long-term care policies, an annual inflation protection benefit is included to help keep up with the rising costs of care over time. A common percentage for this inflation protection is 5%. This means that the benefit amount will increase by 5% each year to account for inflation, ensuring that the policyholder's coverage maintains its value as healthcare costs rise.

Inflation can significantly impact long-term care expenses, so having a 5% increase each year helps policyholders manage future costs and supports their financial planning for healthcare needs.

While other percentages like 3%, 7%, or 10% may also be offered by some providers, 5% is typically recognized as a balanced approach that offers adequate protection without exorbitantly increasing premium costs. Larger increments like 7% or 10% could result in higher premiums, making them less feasible for many clients, while 3% might not provide sufficient coverage against inflation in the long term.