Largest long-term care insurance claims (2017)

A single long-term care insurance policyholder claim has exceeded two million dollars, the first time this threshold has been reported according to an industry analysis of claims conducted by the American Association for Long-Term Care Insurance (AALTCI).

“One insurance company has paid out $2.6 million to an individual who has been on claim for over 20 years,” shares Jesse Slome, director of long-term care insurance organization.  The Association released findings of its study of 2017 claimant data.  Part of the study looked at the largest claims that were still being paid as of December 31, 2017.

“The last time we gathered information for the largest open claims was 2012,” Slome noted.  “At that time, the industry’s largest open claim totaled $1.8 million.”

According to the AALTCI report, the female claimant purchased the policy some 13 years and nine months prior to the commencement of receiving benefits.  “The initial premium paid was $2,600-per-year, so around $36,000 in total cost has secured her and her family an enormous benefit,” Slome adds.   “People mistakenly worry that they’ll buy long-term care insurance and never receive benefits,” Slome admits.   “Despite getting over $2 million in benefits for their purchase, I doubt anyone would want to trade places with someone needing care for over 20 years.”

The largest male claimant has been paid nearly $1.6 million by a different insurer reporting data. This claim has been paid for nearly 10 years (9 years, 10 months), according to Slome.  The policyholder purchased the policy six years and six months prior to starting to receive benefits.  The policy cost $4,475 a year initially according to the AALTCI study.

“This is an important story to tell consumers,” Slome a leading advocate for long-term care planning added.   ”Unfortunately long-term care insurance is often thought of in terms associated with investment vehicles resulting in consumers who worry they may buy something they won’t ever need or use,” Slome admits.  “Long-term care insurance is what I call the ‘reverse lottery’ with many smaller claims and a few whoppers.  But, honestly, unlike the lottery, I wouldn’t consider these super large claimants winners — though their families are certainly glad they have this coverage.”

The Association posted data on the largest claims paid by five insurers to both male and female policyholders on the Association’s website.  To see the data go to www.aaltci.org/LTCFacts.

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“It is important for consumers to understand the importance of their need to address the very real risk of needing long term care but misleading or deceptive information is in no one’s best interest,” declares Jesse Slome, executive director of the national long term care insurance industry trade group.  Slome was sharing insights with professionals who market long term care insurance.

“I keep a rogues’ gallery of misleading information that repeatedly appears in news articles,” Slome shared with the group.   ”They may all be true but often they have zero relevance to long term care insurance and linking the two together is not appropriate way to appropriately educate the public.”  Slome shared three fallacious facts:

“It’s common to read that 40 percent of those needing long term care are under age 65,” Slome says.  “This is a government statistic which includes everyone born with birth defects and severe disabilities, mental issues and other issues.  There is no relevance to long-term care insurance which requires applicants must health qualify for insurance coverage.”

“People start buying long term care insurance in their 50s to address the real risks of needing care as a result of aging, dementia or conditions that generally start after age 70,” Slome explained.  “Of course, accidents and disabling diseases can begin at younger ages but not to the degree the 40 percent statistic implies.”

“A second fallacy is that one needs to protect the full cost of care by showing large scary numbers,” Slome says.  “You see reports that say three years in a nursing home will cost $200,000 and that may be true but most people buy long term care insurance to receive care at home.  Those costs can be far more affordable and every article neglects to mention you should use some of your savings to pay some of the costs.”

According to the long term care insurance expert, over two-thirds of new claims begin with home care.  “You’re likely to receive ‘wake up – tuck in’ services for a few hours which can be fully covered by a modest long term care insurance policy,” Slome adds.  “And, don’t overlook retirement income including Social Security which can be used to pay some of the cost augmented by your insurance.”

Slome noted that many articles overstate the cost of long term care insurance.  “Reporters tend to talk to the same small group of experts, often those who have wealthy clientele or they quote industry averages which mislead many into thinking coverage is expensive,” Slome concluded.  “It can be if you are older, if you have health conditions or if you buy a Cadillac policy.  But it does not have to be and half of all buyers pay less than the average, some significantly less.”

Working with an experienced long term care insurance professional is advantageous because both costs and policy provisions vary significantly.  “We define a specialist as someone who has helped 100 or more people get long term care insurance,” Slome explained.  “A consumer can pick who they work with but those we speak with share that specialists provide them with far greater information relevant to their situation and typically better choices for options.”

For additional information or to request long term care insurance costs and information connect with a designated long term care insurance specialist who is a member of the Association by calling the organization at 818-597-3227 or visiting their website.

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long term care insurance almanac

Los Angeles, CA – January 22, 2013:   The Long Term Care Insurance Almanac and Book of Facts is a comprehensive source of information related to the subject of long term health care and insurance addressing the risk.

“We research and gather the most relevant information focused on the long term care insurance industry and published it in one concise eight-page Almanac,” explains Jesse Slome, executive director of the American Association for Long-Term Care Insurance, the national trade group based in Los Angeles, CA.  “It is the perfect resource for insurance and financial professionals who want to be prepared to address questions raised by their clients and prospects.”

Copies of the Almanac are being made available by the Association with no shipping charge.  “We want as many insurance agents as possible to mount awareness campaigns to urge more Americans to plan for the real risk of needing costly long-term care and sharing the Almanac with clients and other professionals is essential to their efforts,” Slome notes.  “For that reason, we are pleased to absorb the cost of shipping copies.”

The Almanac contains pages of information dedicated to Home Health Care, Assisted Living and Nursing Home Care as well as data and statistics on long term care insurance claims.

Copies of the Long Term Care Insurance Almanac can be viewed via the organization’s website (click the link).  Copies can be ordered online or call the Association at (818) 597-3227.   Free shipping is being offered on a limited time basis and may be withdrawn by the Association without notice.

Established in 1998, the American Association for Long-Term Care Insurance is the national association serving insurance and financial professionals who provide long-term care financing solutions.

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“While most long term care takes place today in the home, people still want to prepare for what we refer to as the worst case scenario, which is a nursing home stay,” explains Jesse Slome, executive director of the American Association for Long-Term Care Insurance.  The organization publishes independently conducted research in their 2012 Long Term Care Insurance Sourcebook.

<h2>Long Term Care Insurance – Nursing Home Avoidance Insurance</h2>

According to the data that reported the length of stay in a nursing home since admission, nearly a quarter (24.5%) of individuals under the age of 65 had been residents for three months or less.  “About the same percentage (24.2%) had been there for between one and three years,” Slome notes.  The study reports that 27.6 percent had been residing in the nursing home for three years or longer.

The study revealed compared those with stays of three years or more and found that 27.5 percent of women were residents longer, compared to 21.1 percent for men.  “There’s no question that because women live longer lives, their risk of needing long term care services, which could take place in a skilled nursing home facility is greater,” Slome, one of the nation’s long term care insurance experts reports.  “That is a reason we urge both women and men, but especially women, to do some long term care planning prior to reaching Medicare-qualification age.”

November is Long Term Care Awareness Month and the trade group urges individuals to take 10 minutes to learn more about the issue.  The organization offers four excellent consumer guides that are available online addressing ways to plan for the long term care risk and providing information relevant for those who may want to consider long term care insurance.  The guides can be accessed at http://www.aaltci.org/guides.

Established in 1998 as a non-profit trade group, the Los Angeles, California-based American Association for Long Term Care Insurance advocates for the importance of planning for long term care and supports insurance and financial professionals who market LTC insurance.  The Association established November as National Long Term Care Awareness Month in 2001.  To learn more about long term care insurance costs call the organization’s offices at (818) 597-3227 or visit the Association’s website.

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