Elimination Period

The length of time between when an injury or illness begins and receiving benefit payments from an insurer. Also known as the "waiting" or "qualifying" period, policyholders must in the interim pay for these services and can be thought of as a deductible.

In general, the shorter the elimination period, the more expensive the policy and vice versa. Typically, most insurance policies have the most attractive rates for 90-day elimination periods. A policy with anything longer than 90 days, while less expensive, may not save you much for the extra risk you take on. Also, when choosing a long-term care insurance policy, some policies require the elimination period to consist of consecutive days of disability. For example, if your elimination period was 90 days, you would need to be in a hospital or disabled for 90 consecutive days before any coverage begins - accumulating 90 days in total over a specified period of time (i.e. six months) would not qualify you for coverage. Before buying LTC insurance, make sure you know the terms of the elimination period.