Elderly Americans are making it clear that they do not want to go to a nursing home for long-term care, and they are investing in insurance to make sure that’s the case, according to the American Association for Long-Term Care Insurance.
“Clearly, most claims still start and end with home care,’’ said Jesse Slome, director of AALTCI. “People want to remain in their home as long as possible and long-term care insurance enables people to do just that,’’ he said.
Slome added that, “people continue to associate long-term care with nursing home but some of us think LTC insurance is really ‘Nursing Home Avoidance’ insurance.’’’
The association’s latest research found that more than half of long-term care insurance claims begin at home, and 43 percent ended at home.
The research shows some 350,000 Americans bought long-term care protection, of which 84 percent tacked on other products. The linked-benefit, also called combo or hybrid, include a broad variety of life plus long-term care or annuity plus long-term care.
Slome said he was surprised to see that so many people are still in the marketplace. He pointed to the demise of Genworth, the biggest player in the industry, and noted that some thought that was the end of LTC insurance. Last year, Genworth raised rates 58 percent in more than half the states. That was on top of 28 percent increases in each of the last two years.
“The notion that LTC insurance was down and that nobody was buying and selling it is really far from true,’’ Slome said, adding that the report’s findings are “significant for the profession and that there is a growing number of option and that the market continues to grow,’’ he said.
Slome said insurance companies have taken note of the growth of the combination products and have begun to expand their offerings to meet the needs, adding that most of these policies were sold as single premiums, requiring a single payment of $50,000 to $100,000 per individual.
The research shows that industry claims for long-term care reached $10.3 billion at the end of 2013. That has climbed steadily from 2015 when it was $8.14 billion.
Claims, the research indicates, have surpassed the $2-million threshold. Slome noted that five years ago the association began to see claims reach $1 million, now they have reached $2 million. The reality is that people don’t buy insurance to pay small claims, they buy it so they have options,’’ he said.