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LIMRA: Individual LTC Sales Rebound

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Individual long term care insurance sales were 13% higher in the first half than they were during the comparable period in 2009.

LIMRA, Windsor, Conn., says the growth this year reflects the poor performance of individual LTC insurance in the recent past: Sales were 30% lower in the first half of 2009 than in the first half of 2008. The only annual increase LIMRA has recorded for the product since 2002 has been a 3% increase in 2007.

But the number of lives covered by U.S. individual LTC insurance policies increased 11% during the first half this year, and new premium at the top 5 carriers grew 26%. One carrier doubled new premium. At the top 10 carriers, 7 reported growth, and 4 reported increases over 30%.

Although the bigger carriers in the market prospered, most of the others struggled, and sales at 9 dropped 20% or more.

LIMRA collected first-half LTC insurance market data from 20 carriers that account for about 95% of the U.S. individual LTC insurance market.

Other survey findings:

- Sales of qualified individual LTC policies increased 13% in the first half, to

$241 million; sales of non-qualified policies fell 10%, to $1.3 million.

The Internal Revenue Service treats payments for LTC policies that meet certain state requirements as medical expenses. Policyholders who itemize deductions may be able to deduct part or all of the premiums.

- The average LTC insurance premium for the first year of coverage increased 2%, to $2,174.

- Multilife LTC programs did well. LIMRA says 13 of the carriers that participated in the survey reported multi-life sales of individual LTC insurance. New multilife LTC premium increased 12%, to $40 million, and new lives covered through multilife LTC insurance sales efforts increased 6%, to 21,000. Associations accounted for most of the multilife growth. At associations, new multilife premium increased 55%, to $27 million; at the worksite, new multilife LTC premium fell 32%, to $12 million.


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