A look at long term care insurance claims in the U.S.

Little data about long term care (LTC) insurance claims is available in Canada as of yet. However, data from the U.S., where LTC insurance has been sold for more than 30 years, provides insight into how claims experience may emerge in Canada.

What conditions account for most LTC insurance claims in the U.S.?

Cancer and arthritis are the leading causes of home health care claims for males and females, respectively.(*1)

For both males and females, Alzheimer’s accounts for the most nursing home claims in the U.S., followed by stroke.(*2)

Fast Facts (*3)

•  Average age at date of claim: 79.9 years old
•  Leading cause for home health care claims
•  before age 75: Cancer (20% of claims)
•  age 75 and older: Alzheimer’s (24% of claims)
•  Leading cause for nursing home claims:
•  Alzheimer’s (average length of claim – 694 days)*
•  68% of nursing home claims end in death
•  49% of home health care claims end in recovery

“Buying long term care insurance was probably one of the best decisions I ever made for myself. I’ve had two hip replacements and fell, leaving me with a damaged hip and pelvis. It was then that all the emotional stress began unfolding. Without long term care insurance, I would have had to leave my home. Plus, there would have been serious implications with what my son could not have done with his life and career, if he felt he had to be there to take care of me.”

John Hancock claimant

As of December 31, 2005, John Hancock, a subsidiary of Manulife Financial, had paid out more than $1 billion U.S. in LTC insurance claims.

(*1, *2) Source: Society of Actuaries, Long Term Care Experience Committee, Intercompany Study 1984-2001

(*3) Duration is understated as 18% of nursing home claims caused by Alzheimer's were still actively on claim.
(Source: Society of Actuaries, Long Term Care Experience Committee, Intercompany Study 1984-2001)