The safest predictions to make for the private long-term care insurance (LTCI) market are that interest rates will stay low, people will keep getting old, and policymakers will continue to be cold.
Insurers are conducting reserve reviews that may lead to more scrutiny from Wall Street.
But, on the other hand, to quote Warren Buffett, “Be greedy when others are fearful.”
Investors, securities analysts and many insurance company executives are certainly scared of long-term care (LTC) risk right now, and that might be a sign that the LTCI market is near a market bottom.
Here are five other thoughts about why 2015 might be better than 2014.
1. The insurers, agents and brokers in the market really want to be in the market.
Any companies and producers that were wishy-washy about LTCI or long-term care (LTC) planning in general must be gone by now. The players still in the game can see that this game’s for keeps.
2. The level of competition is less intense.
The players in the market may have an easier time working with consumers who already understand why LTC planning is important, rushing tire kickers along, and making a realistic price stick.
It’s not as if 20 other hungry giants are competing for every consumer’s business.
The respite may give the remaining players the same kind of freedom to “take a disciplined approach to pricing” that helped get the disability insurers out of their funk in the 1990s, and helped get the trial-lawyer-plagued major medical insurers out of their own funk just 15 years ago.