At the height of the pandemic last year, nursing homes became the epicenter of the Covid-19 virus. Their residents and staff accounted for one-third of all Covid-related deaths in the U.S.

The repercussions for the long-term-care insurance market soon became very clear.

For starters, overall interest in LTC planning, a subject that’s often put on a back burner, became intense.

Brian Gordon, the president of LTC insurance specialist Murray A. Gordon & Associates/MAGA in Bannockburn, Ill., said clients who had rejected LTC coverage a few years ago came back with a change of heart. “They are thinking about the issue and getting serious about planning for the future,” he said. “They see how it gives the family direction and a plan for care, some of which is due to their experiences with Covid, whether they had it themselves or a friend or family member did.”

In addition, clients and insurance carriers alike are putting more emphasis on coverage that allows you to remain in your own home when you need care, instead of having to be institutionalized.

The pandemic “dramatically impacted both the interest and the way knowledgeable specialists market the protection,” said Jesse Slome, director of the American Association for Long-Term Care Insurance in Los Angeles.

The industry began stressing the fact that “the majority of LTC insurance claims pay for home-care services,” he said—in response to rising interest for this coverage option.

At the same time, however, it’s become harder than ever for clients to secure traditional, stand-alone LTC insurance if they don’t already have it.

“The pandemic certainly affected the underwriting criteria used for accepting or rejecting new applications,” said David Beck, an insurance agent and partner at Egan, Berger & Weiner in Vienna, Va. “The number of people who could actually obtain coverage was greatly diminished.”

One of Beck’s clients was told she’d be turned down unless she completed a full face-to-face physical exam because a medical history, virtual exam and recent blood work wouldn’t suffice.

“This guideline was not in existence prior to Covid,” said Beck. He anticipates greater scrutiny of medical records going forward.

In addition, there are more age restrictions and more pre-existing medical conditions deemed uninsurable. If somebody has recently traveled to certain foreign countries it now triggers the automatic postponements of applications and claims for the insurance. Residents of certain states where Covid rates were high are also automatically delayed or denied.

“One major insurer now requires a 90-day waiting period after full recovery [from Covid], and another has a six-month waiting period,” before benefits claims are honored, added Slome.

In a way, all this is understandable. Carriers want clients who are less likely to make claims. Yet the demand is also the highest from those most likely to make claims. “The consumers who are most interested in the coverage are those who see long-term care in their future—and perhaps imminently,” said Len Hayduchok, the CEO and president of Dedicated Financial Services in Lewes, Del., and Hamilton, N.J.

This disconnect between supply and demand could put the industry at risk. “LTC insurance is becoming an almost unviable value proposition in the market,” said Hayduchok.

Consequently, more people than ever are turning to hybrid plans that link LTC coverage to life insurance or an annuity. These products have always had less stringent underwriting requirements to qualify. They also have more predictable premiums (most are paid up front) and resolve the “use it or lose it” problem—i.e., clients will receive benefits one way or the other, either through an LTC claim or as a death benefit. Or both.