HEARING - U.S. Senate Special Committee on Aging

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A recent HLAA survey of our meclher corpanies has found that 12 companies
offered an individual indanity long term care insurance policy as of ayne
1986. Since .ine, four more companies have entered this market. We have
defined this type of policy as one which covers nursing home stays and/or
home health care for not less than 12 consecutive mOntns. Because many
ccpanies have just entered the market, it is too early far them to have
Current information on the number of policies sold. However, those companies
having data show that there were about 130,0X policyholders as of January 1,
1986. Further, for those companies with greater enrollment experience, the
average current age of a policyholder is 75. At least one long term care
inaurance product is available in every state except Conrecticut. However,
since then, at least two companies have filed long term care products in that
state. Typically, four to five HIAA companies are selling policies in each
state.
Services currently covered by long term care policies include skilled,
intermediate, custodial, and home health care. Of the 12 policies analyzed,
all offer skilled nursing care, 10 offer intermediate nursing care and
custodial care, and 8 offer rmne health care. The maximum benefit period for
a typical policy is 3 years, although a substantial nutber offer 5 years of
coverage. Finally, companies typically offer policies with a choice of either
20 or 100 days during which a person must be confined to a nursing home before
insurance payments can begin.
In total, 15 additional companies are developing new products. Many of
these are described as "group insurance" (i.e., marketed to groups with little