Some have suggested that the long-term care insurance industry is in trouble.
The reality is, however, that the long-term care issues facing baby boomers are not going to go away, and that the number of people who need care is only going to increase.
There are an estimated 79 million baby boomers living in the United States today, and they are expected to retire en masse over the next decade.
The cost of dementia is set to double by 2040, and the number of people with dementia is set to triple by 2050. Most of those who need care will be women. Today, women account for about 70 percent of all long-term care claims.
The long-term care insurance industry has made major efforts to adapt to changes in its understanding of the environment, and those changes will help the industry continue to meet the growing need for protection.
One example is the moves long-term care insurance companies have made to shift to gender-based pricing.
There were initial calls of discrimination and claims of unfairness in underwriting, but, in truth, gender-based pricing is nothing new. Like issuers of car insurance, health insurance, and life insurance, long-term care insurance issuers now base rates on the estimated risk of the applicant.
Teenage boys are much more likely to be involved in a car accident, and they pay much higher rates for car insurance.
Women are much more likely than men to need custodial or medical care in old age, so they now face increased rates.