LIMRA Reports Drop In Individual LTC Sales
Roughly 362,000 people bought individual long term care insurance coverage in the United States during the first 9 months of 2003, down 4% from the number who bought coverage during the comparable period in 2002, according a survey conducted by LIMRA International, Windsor, Conn.
Premium revenue from new LTC sales also posted a slight decline, falling 2% from the total for 2002s first 9 months.
Based on new premium, the top 10 writers in the 3rd quarter of 2003 accounted for a combined market share of 86%, up 5 percentage points from the same period last year, according to LIMRA.
The top 5 writers accounted for 68% of new premium, an increase of 4 percentage points over 3rd quarter 2002 sales, LIMRA says.
LIMRA found that 15 of the 23 carriers surveyed reported lower LTC sales revenue for the latest quarter than they reported for the 3rd quarter of 2002.
But strong results for the 1st quarter are helping the 9-month results, and 9-month LTC sales premium totals are up 10% or more at 10 of the carriers surveyed, LIMRA says.
Consumers who bought individual LTC insurance during the first 9 months of 2003 are paying an average of $1,870 during the 1st policy year, up 1% from the average for 2002.
Although individual LTC sales were down, group LTC insurance sales nearly quadrupled between the 1st half of 2002 and the 1st half of 2003.
The growth was driven by the success of the new federal LTC insurance program, which resulted in a 343% increase in total new premiums for employer-sponsored LTC insurance sales.
However, excluding the results for the federal program, group LTC sales declined 33%, according to LIMRA.
Only 1 carrier other than the federal LTC consortium reported sales growth in the employer-sponsored market, LIMRA says.
Workers who bought LTC coverage through the worksite during the 1st half are paying an average of $1,176 during the 1st policy year, according to LIMRA.
Reproduced from National Underwriter Life & Health/Financial Services Edition, January 2, 2004. Copyright 2004 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.