The LTC insurance conundrum: Slumping sales, but no shortage of demand

It’s the best of times and the worst of times for Christine McCullugh, president of LTC Solutions, a group long-term care insurance specialist agency in Redmond, Wash. On the one hand, she says business is booming. On the other, “It’s difficult to find product,” she laments.

Her predicament stems from the dwindling number of carriers that still offer stand-alone long-term care insurance on a voluntary group platform. More carriers still sell individual LTCI, but overall sales have been on a downward slope for several years, according to LIMRA data.

Sales, meanwhile, of combo products—permanent life policies that give policyholders the option to drawn down their death benefit for long-term care expenses—have been going up. In 2016, LTCI contracts generated $228 million in premiums, versus $2.6 billion for combo products. Combos have now outsold individual LTCI policies for the past decade, according to LIMRA.

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