One of the most important considerations should be adding a benefit increase option to your policy. This rider will allow your MDB to increase each year, helping you keep up with future increased costs in care. There are 3 options available:  simple, compound or the Guaranteed Purchase Option (GPO) which is based on the Consumer Price Index.

The Guarantee Purchase Option (GPO) provides an offer every two to three years to increase the Daily Benefit based on the Consumer Price Index.  This offer varies from company to company, usually every three years. Normally, if you decline a certain number of increases, the rider will no longer be offered.  Note:  With the GPO, all benefit increases will be purchased at your age when the offer is extended.

The Simple Benefit Increase Rider provides an automatic increase in your Daily Benefit on each policy anniversary. The increase will be 5% of the original Daily Benefit. For example if you had a $92 Daily Benefit, your benefit would increase by $4.60 each year. So, on your 1^st policy anniversary the benefit would increase to $96.60 per day.  On the 2^nd anniversary it would increase to $101.20 per day. With the Simple Benefit Increase Rider, your Daily Benefit would double in 20 years. Note:  Simple Benefit Increase Rider is not available in all states.

The Compound Benefit Increase Rider provides for an automatic increase of the Daily Benefit on each policy anniversary of an amount equal to 5% of the previous year’s Daily Benefit. For example, if you had a $92 Daily Benefit, on your 1^st policy anniversary, your benefit would increase to $96.60 per day.  On the 2^nd anniversary it would increase 5% of $96.60, which would be $101.43 per day. The benefit would continue compounding over the life of the policy. With the Compound Benefit Increase Rider your Daily Benefit would double in 15 years. The next page will show how inflation impacts your daily benefit.