LTCI sales drop, but premiums hold steady

Insurers were protecting 4.8 million Americans against the cost of long-term care, just 1 percent fewer than they were protecting in 2013. Total premium revenue increased 1 percent, to about $10 billion, or about $2,080 per covered life.

New-sales shrinkage was a little lower in 2014 than in 2013.

In 2013, the new number of new LTCI lives covered fell 26 percent, and total premium from new LTCI sales sank 30 percent.

Some carriers have said that they are de-emphasizing sales of LTCI because of concerns about the effects of low interest rates and inaccurate assumptions about policyholder behavior on old blocks of LTCI business.

LIMRA analysts found that seven of the carriers actively selling LTCI let sales fall 20 percent or more between 2013 and 2014, but that four increased sales more than 10 percent.

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The percentage of sales premium going to the five biggest carriers in the market fell to 71 percent in 2014, from 76 percent in 2013. New-sales premium revenue at the five biggest players in the market fell an average of 27 percent, but that new-sales premium at the 11 other active LTCI issuers surveyed fell just 5.8 percent, to $92 million.