The largest open long-term care insurance claim made by a female policyholder has reached $1.8 million in paid benefits; the largest claim made by a male policyholder now exceeds $1.3 million in paid benefits, according to a new report from the American Association for Long-Term Care Insurance (AALTCI).
“Long-term care insurance companies paid $6.6 billion in benefits in 2012 to a record 264,000 individuals,” said Jesse Slome, director of the AALTCI. Roughly half of newly opened claimants received benefits for covered home care services with the rest paying for care in assisted living communities or skilled nursing homes.
The association's annual claims analysis revealed that the female claimant has received benefit payments for 15 years and nine months as of Dec. 31, 2012. "Her claim which now exceeds $1.8 million started three years after she purchased a long-term care insurance policy," Slome explains. "Consider that she paid $881 yearly for the coverage with payments ending when her claim began."
The largest open claims reported by leading insurers ranged from $322,286 to $1.8 million.
"Several of these very large claims began just a few months after the person purchased their policy," said Slome. "People mistakenly associate long-term care with care needed by the elderly. Accidents, injuries and illnesses also can result in a need for long-term care."
According to the organization's study, the majority of new long-term care insurance claims in 2012 started after the policyholder was age 70. In fact, more than two-thirds (68 percent) of new claims began after the policyholder turned 80; about one-in-four (23.5 percent) started their claim between ages 70 and 79.
The most common reasons for a long-term care insurance claim are Alzheimer’s disease, stroke, arthritis, circulatory issues or injury.
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