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 LTC Insurers Paid $6.6 Billion In Benefits In 2011

Long term care insurers paid $6.6 billion in benefits to nearly 200,000 individuals last year, according to a new report from the American Association for Long-Term Care Insurance (AALTCI).

The report, which is compiled from 10 insurers, shows that women make up two-thirds of long term care insurance claimants.

Also in the report: One in 10 (10.4 percent) of new individual claims initiated during 2011 began before the claimant was age 70. The five most common reasons for a long term care insurance claim are Alzheimer's disease, stroke, arthritis, circulatory issues, or injury.

“While most long term care insurance claims begin at older ages, typically in one’s late 70s or 80s, accidents and illnesses are also a common reason younger people need this care for extended periods,” said Jesse Slome, AALTCI executive director. 

The study also found that the largest open long term care insurance claim has reached $1.7 million in paid benefits. The claimant, who is a woman, purchased coverage at age 43, paying an annual premium of $881, according to AALTCI. Three years later her long term care insurance claim began and has continued for almost 15 years. [Note: Payment of policy premiums ceases when an individual is receiving policy benefits.]

The association collects data annually on claims, including the largest open claims (still being paid as of December 31, 2011). The second largest claim still open is for a male who paid an annual premium of $3,374. His claim, which began three years after purchasing the policy, has continued for just over six years ($1. 2 million in benefits has already been paid for his care).

“Long-term care insurance is not the lottery,” Slome says. “A policy holder who paid $3,000 in premiums and received benefits exceeding $1.5 million is not a winner. But having this protection in place can certainly pay off, and for thousands of Americans it increasingly is.” 

According to the association, just over 8 million Americans currently have some form of long term care insurance protection in place.
 
For a copy of the study, go to www.AALTCI.org.

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