America’s long-term care insurance companies paid $8.65 billion in benefits to 280,000 people in 2016, an increase of 6 percent over the prior year, according to the American Association for Long-Term Care Insurance (AALTCI).
“The total of all benefits paid increased by over 6 percent and the number of long-term care insurance policyholders on claim grew by roughly 20,000,” Jesse Slome, director of the AALTCI, the national trade group that reports annual claims data, said in a statement.
In 2015, AALTCI reported total claims of $8.15 billion paid to 260,000 individuals.
Meanwhile, the number of individuals paid benefits because they had purchased a traditional long-term care insurance policy increased by nearly 8 percent.
Without insurance to pay some or all of the costs of long-term care, Slome said the caregiving responsibility often falls on elderly spouses or adult children of aging parents.
“It’s more than just money that long term care insurance provides,” Slome said. “It’s as much about having control and choices, while protecting your retirement plans and lifestyle. I like to tell consumers who are deciding if this is a prudent move, that having even some long-term care insurance in place allows loved ones to care about you rather than being forced to care for you.”
In a related study, Slome said the majority of long-term care insurance claims begin and end in the home.
“Individuals continue to mistakenly think of long-term care insurance as nursing home insurance,” Slome said. “I sometimes refer to LTC insurance as nursing home avoidance insurance because often having this insurance protection in place allows the individual to be cared for in their own home.”
The analysis found the majority of new claims starting in 2016 (54 percent) began in the home. That represents a 3 percent increase compared to the association’s last study, conducted in 2012.
“People want to be in their home with family and loved ones, and having some long-term care insurance in place can help pay for the cost of home care services,” Slome pointed out.
For more information about long-term care insurance, please contact your USI representative.