A report released Monday by the American Association for Long-Term Care Insurance found the 10 leading LTCI companies paid $10.8 million in daily claim benefits in 2010. Total benefits paid by those insurers for the year was nearly $4 billion. AALTCI estimates that benefits paid industrywide in 2010 were $6 billion.
"During a typical 30-day timeframe, these insurers paid benefits to nearly 135,000 individuals," Jesse Slome, executive director of AALTCI, said in a press release.
In 2007, daily claims value totaled just over $7 million. The daily total for 2010 represents a 53% increase over 2007 levels. That increase is primarily due to aging claimants, Slome told AdvisorOne.
"A 65-year-old who purchased coverage in 1995 is now 81; the typical age when claims often begin," Slome wrote in an e-mail message. "So you have more people on claim, but these policies tend to have built-in inflation growth (typically at 5% a year). That will account for some of the growth as well."
Approximately eight million Americans own a long-term care insurance policy, and about 350,000 are sold each year, according to AALTCI. Over 38% of individual claims are for skilled nursing home care; 31% of claims are for home care, and 30.5% are for assisted living costs.
Insurers reported on data including individual and employer-sponsored plans. Insurers include Conseco/Bankers Life; Continental Casualty; Genworth Life; John Hancock; Metropolitan Life Insurance Co.; Mutual of Omaha; Prudential Insurance Co. of America; Thrivent Financial For Lutherans; Transamerica Life Insurance Co.; and Unum Life Insurance.