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Life Health > Health Insurance > Your Practice

LTCI Watch: A Mixed Bag

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Some long-term care insurance (LTCI) suppliers are doing well this year.

Jason Goetze, someone who’s been in the LTCI community since 1989, looked out at the market for us and reported that industry-wide sales are booming.

“The problem with measuring the market in this global perspective is that there are some big winners and some big losers,” Goetze says.

He’s found that there’s an “inverted bell curve,” with some companies are showing sales growth over 20% and others showing sales drops over 20%.

“A stable industry will have a bell shaped curve with few companies at the extremes and most in the middle,” Goetze says.

The inverted bell curve is a sign the LTC insurance market is evolving rapidly, he says.

The real size of the untapped market is another consideration, Goetze adds.

The true size represents the number of consumers in the potential buyer age group who can afford LTCI coverage and can qualify to buy it, which is much smaller than the total number of people in the potential buyer age group, he says.

“With this said, the number of potential buyers still outpaces the number of insureds,” he says. “Even the number of insureds is hard to quantify because some people, like me, own multiple policies from multiple companies. Some who own a group policy may also own an individual policy.”

For now, though, there are plenty of consumers who can have and should have LTCI and don’t, and the real competition comes from “ignorance, apathy and denial,” Goetze says. “They have a huge market share.”


Analysts at the SCAN Foundation, Long Beach, Calif., have used data from Avalere Health L.L.C., Washington, a health policy firm, to quantify the relationship between chronic conditions and limitations on the ability to handle activities of daily living (ADL), such as bathing, eating and meal preparation.

In 2006, average per-capita Medicare spending for a senior with 5 or more chronic conditions was $19,763 for a senior with problems with at least one ADL and $10,133 for a senior without ADL problems.

The analysts also found that only about 8% of seniors with one chronic condition also had a trouble with at least one ADL, and that about 26% of seniors with 5 or more chronic conditions had at least one ADL problem.


The American Association for Long-Term Care Insurance (AALTCI), Westlake Village, Calif., will be promoting the need for long-term care planning with an advertorial section in the December issue of Kiplinger’s Personal Finance magazine.

AALTCI wants to use the supplement to try to get consumers interested in the need for LTC and LTCI planning at a younger age.

The supplement is set to include advertisements from John Hancock Life Insurance Company (U.S.A.), a unit of Manulife Financial Corp., Toronto (TSX:MFC), and a unit of Prudential Financial Inc., Newark, N.J. (NYSE:PRU).

The issue will be on newsstands on November 8.

One note of caution: Newsstands are looking a lot scrawnier than they used to look. If you still like print magazines, consider buying a few from a newsstand, to give stores the idea that newsstands should continue to exist.


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