As members of Generation X and Late Boomers complete their future retirement planning concerns for how they will pay for Long-Term Health Care becomes a primary factor in their planning. As a result, six leading insurance companies that provide Long Term Care Insurance plans have shown sales growth in 2015 and that trend is continuing in 2016.
Many of these people have had parents who are now using their LTC policies. The American Association for Long-Term Care Insurance (AALTCI) reported that in 2015 the industry paid out $8.15 billion in claims. That number continues to grow.
America’s Health Insurance Plans (AHIP) reports most claims are paid. They say only 4 percent of individuals filing a claim reported that the claim was declined and this decreases to 2.4 percent a year after the initial claim.
“Americans are living longer and often the result is a need for Long-Term Care,” said Jesse Slome, Executive Director of the AALTCI.
“The individuals who own Long Term Care Insurance policies benefit from the protection as do their families and loved ones.” Said Slome. Without insurance to pay the cost, Slome says the caregiving responsibility often falls on elderly spouses or adult children of aging parents.
“Long Term Care insurance provides choice and control while protecting your retirement plans and lifestyle. It allows loved ones to care about you rather than being forced to care for you,” he said.
AHIP says LTC insurance provides a more cost-effective way to pay for LTC services than relying on personal savings. To pay for the same amount of services covered by insurance costing $188 a month, a 60-year-old person would have to put aside $1,666 a month over 22 years.
If a person sets aside and invests the value of the average LTC insurance premium for 22 years, they would accumulate only enough to pay for six months of care. By putting the same amount into premiums, she could own a policy covering more than three years of care, according to AHIP.
A report published by the National Association of Insurance Commissioners (NAIC) shows company by company the total number of claims paid by the industry. The fact is people need extended care and people with LTC policies see the benefits of these plans.
Top Long-Term Care Insurance specialists indicate interest in LTC policies has increased in the past year. As more people have personal experience they understand their own need to plan so they can safeguard their future income and assets and ease the burden placed on family.
Long-Term Care Insurance premiums are based on the age of the person, their health and the amount of benefit applied for. With most people buying plans at younger ages, premiums are very affordable.
Consumers should work with a specialist who represents the top insurance companies and has substantial experience in the product area. Generally, financial advisors or local insurance brokers have little experience in the product, the underwriting requirements, and product design.