AALTCI finds sharp rise in LTCI costs
By National Underwriter
By Allison Bell
The cost of a typical U.S. individual long-term care insurance (LTCI) policy increased 20 percent between 2012 and 2013, to about $2,065 in premiums per year.
The American Association for Long-Term Care Insurance has reported that finding in a preview of the data that will appear in its new national LTCI price index report.
A year ago, AALTCI was reporting that the cost of comparable coverage was up 16 percent.
AALTCI came up with the 2013 price figure by looking at the cost of coverage for a 55-year-old, single individual who is buying $162,000 in current benefits.
The group comes up with the price index data by conducting a survey of 12 LTCI carriers. The group gets price information for couples as well as for single individuals.
For the 2012 index, the group looked at what the same 55-year-old single individual would pay for between $165,000 and $200,000 in coverage.
AALTCI Executive Director Jesse Slome LTCI said in a statement that costs are going up in part because of rising claims costs and in part because of low yields on the investments backing LTCI policies.
Insurers' LTCI rates vary widely, Slome said.
"For a 55-year-old single policy applicant, the highest-priced policy cost 87 percent more than the comparable lowest-priced policy," Slome said.
Originally published on LifeHealthPro.com