Health · Chapter 17 · Long-Term Care
LTC Inflation Protection
Definition
States require insurers to OFFER inflation protection (typically to applicants under ~76). Two forms: the automatic inflation rider (AIR) — daily benefit grows ~5% compounded annually, cost baked into the initial premium — and the guaranteed insurability option — buy inflation-sized increases at intervals with no proof of insurability, priced at attained age.
Exam tip
At 5% inflation, care costs double in ~15 years — the reason regulators force the offer.
Easy to confuse with
These are what this term gets tested against — if you can't tell them apart cold, drill the contrast.
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