“Asset based or linked products are experiencing growth as they are highly suitable for a very specific consumer,” states Jesse Slome, AALTCI’s executive director.  “Financial planners and investment professionals who may not like the more complex nature of traditional long-term care insurance policies especially find them easier to sell.”

According to the Association’s annual study of new policy sales, more than half (55.7%  Female – 51.5% Male) of new life+LTC policies were purchased by individuals age 65 or older.  Just over a third (34.0% Female – 37.1% Male) were purchased by individuals between ages 55 and 64.

“One of the features of linked products that consumers find attractive is the principle that premiums are not ‘lost’ if the individual never has a qualifying long-term care need,” Slome explains.  “To make coverage meaningful however one needs to make a significant single premium contribution for each covered life.”   For 2010, the initial single premium face amount of policies purchased was $100,000 or greater for two thirds (66.2%) of new policies. 

The Association study found that the vast majority (95.3%) of new Life+LTC policies issued did not include a benefit increase option that bumped up available benefits to keep pace with inflationary growth of costs.  By comparison, the Association’s study of 2010 traditional individual long-term care insurance policy sales, found that 94.5 percent included some form of growth option.

The complete findings are contained in the Association’s 2011 Long-Term Care Insurance Sourcebook.  Founded in 1998, the American Association for Long-Term Care Insurance is the national trade organization established to educate both consumers and financial professionals about the importance of long-term care planning.

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