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COVID-19 Fogs Long-Term Care Claim Forecasts: ILTCI Virtual Conference

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What You Need to Know

  • PwC surveys show experience at privately held LTCI issuers has been similar to experience at the big public companies.
  • For the providers, a tight labor supply is a concern.
  • Another severe pandemic could hit later.

Actuaries for long-term care insurance (LTCI) issuers know that everyone is looking to them for answers about how COVID-19 has affected, and will affect, LTCI claims.

But two actuaries who spoke Tuesday at the ILTCI Conference said getting good pandemic-period experience data will take time.

When news of the pandemic first appeared, in early 2020, “we had so many unknowns,” said Rachel Erne, a PwC managing director. “Now, it feels as if we have even more unknowns … There’s just more and more questions.”

Nick Sheahon, senior director for long-term care in-force pricing and modeling at Genworth Financial Inc., said the answers may vary widely from insurer to insurer.

“In the end,” Sheahon said, “each carrier is going to have different experience.”

Executives from Genworth and other LTCI issuers that are public companies have told securities analysts that COVID-19 reduced claim costs in 2020.

Public companies said the pandemic cut spending on claims by:

  • Killing some insureds who were using their LTCI benefits, and shortening the amount of time those insureds spent using their benefits.
  • Causing some LTCI insureds who were staying in nursing homes and assisted living facilities to move into private homes and use home care, or to rely entirely on help from friends and relatives.
  • Keeping some insureds who became eligible for long-term care benefits during the pandemic from starting to use paid long-term care services.

PwC conducted surveys of about 15 other LTCI issuers. Answers varied from company to company, but, overall, those participating in the survey seemed to see the same things that the publicly traded issuers have been talking about, Erne said.

Erne and Sheahon said one open question is whether the pandemic will end up increasing future LTCI claims.

COVID-19 itself could cause some insureds to need LTC services, the actuaries said. The virus may have accelerated the deaths of people who were likely to die soon from other conditions and spared healthier older people, the actuaries said.

If that’s the case, the insureds who have survived may be healthier people who will live longer, and who will spend more time using LTC services if they need care services, the actuaries said.

The ILTCI Conference

Organizers of the Intercompany Long Term Care Insurance Conference series had to cancel the 2020 conference, because of the COVID-19 pandemic.

This year’s online version of the conference attracted 1,500 attendees, according to Barry Fisher, the conference chair.

The list of top-level sponsors includes Brighthouse Financial, Continental General Insurance Company, Mutual of Omaha, Nationwide, New York Life, National Guardian Life, OneAmerica, Prudential Financial, Thrivent and law firm Faegre Drinker.

Still another noteworthy name on the sponsor list is Integrity Marketing, a company that has grown rapidly through acquisitions.

Conference organizations said they hope to present the 2022 ILTCI Conference as an in-person event in Raleigh, North Carolina.

The Agenda

In the past, some ILTCI Conference attendees were hostile toward use of products that combine LTC benefits with life insurance or annuities.

Opponents of hybrid products argued that the products provided too little LTC benefit help per premium dollar.

Many attendees were hostile toward  state or federal governments providing LTC programs.

The agenda for the 2021 conference includes multiple sessions on topics related to LTC hybrid products and and public LTC programs, such as Washington state’s LTSS Trust Program.

(Image: Ormalternative/Shutterstock)