American Association for Long-Term Care Insurance

Los Angeles; November 4, 2013 – An individual applying for long term care insurance costs the insurer between $400 and $600 even if they are not accepted according to a study from the American Association for Long Term Care Insurance.   The approximate cost to the industry was $200 million in 2012, AALTCI reports.

“Consumers don’t realize that to keep prices as low as possible for all policyholders, insurers take the time to examine health records, conduct face-to-face assessments and all that is costly,” explains Jesse Slome, executive director of the American Association for Long Term Care Insurance.  “When the Federal government attempted to launch a plan with minimal to no health requirements, their own actuaries set premiums so high that they abandoned the program acknowledging that costs were higher than what almost anyone would pay.”

Slome noted that the Association undertook an informal study of costs related to long term care insurance applicants following a discussion with a reporter.  “Like so many consumers we speak to, this individual was surprised to learn how many individuals who apply for long term care insurance are declined due to health reasons,” Slome noted.  “We wanted to substantiate the fact that this cost insurers hundreds of millions of dollars each year.”

According to the Association’s annual research into buyers and claimants, some 25 percent of applicants between the ages of 60 and 69 are declined by insurers after they apply.   The rate is significantly lower at earlier ages.

“Each insurer has its own health underwriting practice that can include extensive review of the applicant’s medical records as well as a face-to-face interview,” Slome explains.  “The goal is not to decline people but just one additional unhealthy person within a pool of 100 insureds could necessitate a significant price increase that is ultimately shared by all policyholders.

Some 322,000 individuals obtained individual long term care insurance protection last year according to the trade group.  “The ideal time to start to look into this protection is between your mid-50s to mid-60s,” Slome recommends.   To request long term care insurance costs from a designated long term care insurance professional member of the Association visit call the organization at (818) 597-3227 or visit the Association’s website at www.aaltci.org.

Tags: aging, American Association for Long-Term Care Insurance, costs, long term care, long term care cost, long-term care insurance, Medicaid, Medicare, sales, women

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