Long term care insurance premiums vary broadly, but are higher overall
The rates that are being paid for this coverage are dependent on a very large number of factors.
A recently released industry report has shown that while the rates for long term care insurance have been rapidly on the rise, the premiums themselves vary broadly depending on a number of different factors that go into the calculations.
The report showed that this year, the average rise for LTC insurance premiums was close to 9 percent.
At the same time, even though the rates for long term care insurance have been rising steadily, overall, the actual amount being paid by customers has a great deal to do with various specifics. Some policies saw increases in premiums that were much higher than others. That said, there were other types of coverage – particularly those covering couples, as opposed to individuals – that saw only a moderate increase. This according to the American Association for Long-Term Care Insurance executive director, Jesse Slome.
The trade group conducted a comparison of top selling long term care insurance policies from large insurers.
This is an annual activity that is held at the close of every January. What the 2015 analysis determined was that the rates from the leading 10 insurance companies had raised their rates, across the board. The analysis used Tennessee as a “representative” state. That said, Slome pointed out that one of the top reasons that was identified to explain the increase in the cost of these policies was that last year, there was a notably higher claim cost recorded. In 2014, insurers made $7.8 billion in payouts, which was almost 5 percent higher than it had been the year before.
The report determined that a healthy male at 55 years old now faces an average premium of $2,075 in annual premiums, for initial benefits of $164,000. When compared to last year, this was a serious jump, as the January 2014 figure had been $1,765.
A healthy woman at the same age would pay even more for long term care insurance, at an average premium of $2,411 per year. This was an increase over last year’s average of $2,307.