|An example of captions in Google+ Hangout, via Google.|
Hangout Captions is an app which must be installed from this page. There's also a support forum for troubleshooting.
This follows the addition of an option to caption videos added to Google+ in May.
I'd be happy to see the addition of Google's automated captions technology to Hangouts as a third option, besides the transcript or professional captions options. Automated captions aren't perfect but they'd be very helpful, especially with the option to edit captions as they appear.