The nation’s long-term-care-insurance companies paid a record $7.85 billion in claim benefits to 250,000 individuals in 2014, according to a report by the American Association for Long Term Care Insurance.
“Total long term care insurance benefit payments increased by five percent from $7.5 billion paid the prior year,” reports Jesse Slome, director of the American Association for Long Term Care Insurance.
The organization reported that insurers paid $6.6 billion to some 264,000 policyholders in 2012.
“Americans are living longer and the consequence is more people needing long term care,” Slome explains. “Contrary to what most people think, the vast majority of long term care insurance pays for care in the home or in assisted living communities, not in skilled nursing homes.” According to AALTCI research, half of all newly opened LTCI claims paid for care in the home. “Consider long term care insurance as nursing home avoidance protection,” Slome adds.
“People underestimate life expectancy,” Slome says. “Few adults in their 50s or 60s are prepared for the financial consequences of their longevity.” According to the organization, roughly eight million Americans have some form of LTCI in the form of either a traditional insurance policy or a linked-benefit life insurance policy that can also pay a long-term-care benefit.
AALTCI’s 2015 Price Index study released earlier revealed costs for traditional LTCI policies rose about eight percent, compared to those of the prior year. The research also found that costs for virtually identical policy coverage varied by as much as 119 percent.
For more information, call AALTCI at 818- 597-3227 or visit the association’s Long-Term-Care Insurance Information Center at www.aaltci.org/long-term-care-insurance.
By Ayo Mseka