In a new study by the American Association for Long-Term Care Insurance, the youngest claimant for LTCI was 24 years old when he first received benefit payments, and received the coverage when he was 21.
Since then, the individual has been receiving payments for seven years, the study finds.
“People often mistakenly associate long-term care solely with nursing home care required by the elderly,” says Jesse Slome, AALTCI’s director. “After purchasing insurance coverage younger individuals have accidents and are diagnosed with health conditions that result in the need for care for months and often years.”
The study comes after AALTCI reviewed data shared by other LTCI companies, and it also finds that the youngest female policyholder on claim opted for coverage at age 28 while many insurers report younger claimants in their 30s.
“Within the same year, she needed care and qualified for benefit payments that have amounted to over $135,000,” Slome says. “A male who purchased insurance at age 36 began receiving policy benefits at age 40. His claim has lasted over six and a half years and the insurer has already paid out over $700,000.”
According to the 2012 Long Term Care Insurance Sourcebook, the LTCI industry paid $6.6 billion in 2011 claim benefits to more than 200,000 individuals. For a policy covering $164,000 in immediate benefits with the option to increase overage in future years runs about $635 each year for a 25 year old, the Association’s 2012 Price Index finds.
"The number of younger individuals purchasing long-term care insurance on an individual basis and through their employer is growing," says Tim Kneeland, president of Transamerica Life Insurance Co.