Long-term care benefits not just for older workers
The American Association for Long-Term Care Insurance is challenging the idea that long-term care insurance is purchased by or benefits only older individuals. While the numbers may skew toward the elderly, the AALTCI hastens to point out that conditions associated with aging are only a portion of the reasons claimants use their policy.
The youngest beneficiary the AALTCI came across in a recent data overview was 21 when he started coverage. At 24, he began receiving benefits and has continued to do so for seven years.
“People often mistakenly associate long-term care solely with nursing home care required by the elderly,” says Jesse Slome, AALTCI’s director. “After purchasing insurance coverage, younger individuals have accidents and are diagnosed with health conditions that result in the need for care for months and often years.”
The youngest female policy holder spotted in the review of data from leading long-term care insurance companies obtained coverage at age 28. “Within the same year, she needed care and qualified for benefit payments that have amounted to over $135,000,” Slome reports.
A number of insurers reported younger claimants in their 30s. “A male who purchased insurance at age 36 began receiving policy benefits at age 40,” Slome says. “His claim has lasted over six and a half years and the insurer has already paid out over $700,000.”
Tim Kneeland, president of Transamerica Life Insurance Company, notes that the number of younger individuals purchasing long-term care insurance on an individual basis and through their employer is growing.
According to the AALTCI’s 2012 price index, a policy that provides for $164,000 in immediate benefits with the option to increase overage in future years costs roughly $635 yearly for a 25-year-old.
Last year the long-term care insurance industry paid $6.6 billion in claims to more than 200,000 people.