IMSA Issues New LTC Guide For Consumers And Producers

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One thing Brian Atchinson came away with after attending a number of insurance industry meetings is that consumers are largely misinformed about where funding for potential long term care needs will come from.

Atchinson is the executive director of The Insurance Marketplace Standards Association, Washington, a watchdog group that sets and maintains ethical standards for the life insurance and annuities and long term care insurance product industry. Its members are life insurance companies.

He says this realization was the impetus behind a new consumer guide from the association that is meant to clarify the product for consumers and assist LTC insurance producers at point of sale.

“What surprised me is how many people presume that the government will provide for them,” Atchinson says. “People presume Medicare covers more than it does. They have a propensity to blur the lines and misunderstand whats available.”

Although he finds this has been the case for some time, Atchinson also has noticed that more and more people are starting to think at a younger age about what their future LTC needs are going to be.

“There is a growing understanding (that LTC insurance) is a good part of planning and addressing needs,” he says. “More and more boomers are confronting the reality that they will have needs.”

The guide provides information in an unbiased, objective way, Atchinson says.

“The decision to buy LTC insurance is usually made over a period of time after careful consideration, often in consultation with an agent or financial planner, and people are looking for objective information to help them with making the decision,” he says.

Consumers can access the guide for free from the associations Web site, at www.IMSAethics.org. Agents for IMSA member companies also will offer these brochures in the near future.

A number of carriers have expressed interest in making the guide available to producers so that they can leave it with clients, Atchinson says.

“It gives them a lot of good questions they should ask themselves as part of the decision-making process,” he says.

The 12-page guide provides consumers with information about such issues as:

–Cost of long term care. (An average of $56,000 per year in 2001 in a nursing home, but up to twice that in some parts of the country; $12,000-$16,000 for home care in 2001, but more for skilled professionals and round-the-clock care.)

–Stringent limitations on how much the government or private health insurance pay for LTC. (For example, Medicare pays for only about 12% of nursing home costs, for a short period of time, when a patient is recovering from acute illness or injury after a hospital stay.)

–Benefits of LTC insurance (protecting family assets and ensuring personal assistance and nursing care).

–How to determine if long term care insurance is needed and how much to buy.

–What to look for when selecting a long term care insurance policy. (For example, type of care and services covered; when coverage begins and how long it lasts; type of care facilities covered; limitations on coverage; premium costs, etc.)


Reproduced from National Underwriter Life & Health/Financial Services Edition, October 24, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.