The American Association for Long Term Care Insurance last week released a report summarizing the amount long term care insurance companies paid for long term care claims in 2008.
Insurers paid $8.5 billion in long term care insurance claims for 180,000 U.S. insureds in 2008
There are some very interesting pieces of information to take from the report:
The Association’s study revealed that 30.5% of claims start between ages 70 and 79; some 60.6% after age 80.
While the percentage of claims started after the age of 70 is large, the amount of money saved on yearly premiums for those who purchased insurance for long term care at a younger age is remarkable. Just comparing the two largest claims in 2008, we see a huge difference in long term care premiums.
The largest reported open LTC claim has paid out more than $1.2 million in benefits, the AALTCI says.
The claimant, a woman, bought coverage at age 43 for an annual premium of $1,800. Her claim began just 3 years later and has continued for almost 12 years.
Compare this rate with the following:
The second largest claim was submitted by a woman who bought her LTC insurance policy at age 72, for an annual premium of $12,766. Her claim began 3 years later and has continued for almost 9 years, paying a total of more than $1 million in nursing home benefits.
Purchasing long term care insurance at a younger age can and will save you a lot of money in the long run. Sure, you may be healthy now, but as the above quote suggests, nothing is guaranteed, as the women needed her insurance when she was just 46.
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