A new study from the American Association for Long-Term CareInsurance shows the economy has affected when individuals starttheir long-term care planning and what benefit levels and policyoptions they select.

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According to AALTCI's annual study, 73.5 percent of buyers ofindividual policies were age 55 or older when they applied forcoverage compared to 69 percent for the prior year (2008).

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The study also found a slight increase in the percentage ofindividuals selecting lower benefit levels and longer elimination(deductible) periods. Both contribute to lower premium costs. Some43 percent of buyers selected initial daily benefit amounts of $149or less; compared to 37.5 percent for the prior year. The vastmajority (92.2 percent) of buyers selected elimination periods of90 days or longer; compared to 86 percent for the prior year.

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"The most common benefit period selected remains three years,"said Jesse Slome, AALTCI's executive director, in a statement.

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Some 29.5 percent of buyers selected a policy designed to paybenefits for at least three years. The overwhelming majority addedan inflation growth option that increased benefits each year. "The5 percent compound growth factor, chosen by 47 percent of buyers,can double or triple the cost of the base plan of insuranceprotection. Buyers understand they are protecting future risk and saved in some areas but were willing to paymore for this important option."

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AALTCI added two new areas to the 2009 study: average premiumpaid and marital status at time of purchase.

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According to the findings, the average buyer between ages 45 and54 paid $1,900 annually for their coverage. "There was asignificant average price range between companies," Slome notes,"from as low as $1,000 to over $3,200 for this age segment."

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The vast majority of buyers of long-term care insurance aremarried. According to the report, some 54 percent of purchasesinvolved couples covering both lives. Twenty-four percent involvedcouples or partners where only one individual was covered with 22percent of policies purchased by single individuals.

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The complete findings of the survey will be contained in the2010 Long-Term Care Insurance Sourcebook published by the AmericanAssociation for Long-Term Care Insurance.

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