Voluntary Benefits
Published by Adam Bezman on September 5th, 2019
In the insurance industry, the term “long-term care” often conveys a certain imagery. Just to make sure, I did an image search for the phrase “long-term care”. It’s not the most scientific approach, but the results were about what you’d expect: elderly people, wheel chairs, canes.
New research is showing that we may have the wrong idea when it comes to long-term care. The face of long-term care is changing. Which isn’t to say that the elderly aren’t among the most likely to need long-term care, but increasingly, they aren’t the only ones.
Changing demographics
Recipients of long-term care (LTC) are getting younger. Not just in the worksite market, but overall. And the change is significant. According to a study published by Genworth at the end of 2018, significantly more recipients of LTC are under the age of 65 than was the case just 9 years ago:
Why is the age of care recipients coming down? Well one reason may be that fewer people are requiring care for illnesses and more people are requiring it due to accidents. Per the Genworth study:
What are some of the potential implications of people needing LTC when they are younger? One is that people need education to understand the need for LTC coverage at a younger age. In fact, according to the Genworth study 63% of care recipients had never considered the need for LTC prior to needing care. Education on what LTC is, what can cause someone to need care and how LTC can affect anyone will hopefully help them to consider the need from earlier on.
Another potential implication is that people could exit LTC at a younger age, more ready to live fuller lives. So a combo product that combines life insurance and LTC may make more sense. Products that don’t fully use up the life insurance benefit could be valuable as the insured will likely still have a strong need for life insurance after their LTC is complete. Selling a standalone LTC product to a young person may be a challenge, which is why we believe it’s important to raise awareness on these combination products.
Education for consumers is key, but it’s also important for brokers to consider the kind of LTC protection they’re offering and who it is that will be making use of the benefit. It’s no longer enough to assume that they’ll be waiting until their later years to use the product. The face of long-term care is changing and, to provide the care consumers need, we need to make sure we’re able to adapt to those changes.
Source: How Caregiving Affects Families, Communities and Societies. Genworth. 2018.
New research is showing that we may have the wrong idea when it comes to long-term care. The face of long-term care is changing. Which isn’t to say that the elderly aren’t among the most likely to need long-term care, but increasingly, they aren’t the only ones.
Changing demographics
Recipients of long-term care (LTC) are getting younger. Not just in the worksite market, but overall. And the change is significant. According to a study published by Genworth at the end of 2018, significantly more recipients of LTC are under the age of 65 than was the case just 9 years ago:
- In 2010 81% of care recipients were 65+
- In 2018 57% of care recipients were 65+
Why is the age of care recipients coming down? Well one reason may be that fewer people are requiring care for illnesses and more people are requiring it due to accidents. Per the Genworth study:
- In 2010 44% of care recipients needed care due to an illness. In 2018, this decreased to 32%
- In 2010 11% of care recipients needed care due to an accident. In 2018, this increased to 21%
What are some of the potential implications of people needing LTC when they are younger? One is that people need education to understand the need for LTC coverage at a younger age. In fact, according to the Genworth study 63% of care recipients had never considered the need for LTC prior to needing care. Education on what LTC is, what can cause someone to need care and how LTC can affect anyone will hopefully help them to consider the need from earlier on.
Another potential implication is that people could exit LTC at a younger age, more ready to live fuller lives. So a combo product that combines life insurance and LTC may make more sense. Products that don’t fully use up the life insurance benefit could be valuable as the insured will likely still have a strong need for life insurance after their LTC is complete. Selling a standalone LTC product to a young person may be a challenge, which is why we believe it’s important to raise awareness on these combination products.
Education for consumers is key, but it’s also important for brokers to consider the kind of LTC protection they’re offering and who it is that will be making use of the benefit. It’s no longer enough to assume that they’ll be waiting until their later years to use the product. The face of long-term care is changing and, to provide the care consumers need, we need to make sure we’re able to adapt to those changes.
Source: How Caregiving Affects Families, Communities and Societies. Genworth. 2018.
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Written by Adam Bezman
Executive Director, Product and Innovation
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