As our population ages, Long Term care insurance has become more and more popular as a cost-effective way to preserve one's hard-earned nest egg. After all, the cost of a nursing facility stayt (or even at home care runs into the thousands of dollars a motnh, and can quickly eat up one's savings.
The challenge,of course, is that as we age we tend not to get healthier, and the odds of having such a claim increase each year. Which begs the question: how is this affecting carriers' bottom lines?
Well, we have one answer here, thanks to co-blogger Bob:
"Unum Falls as Long-Term Care Loss Ratio May Prompt Reserve Charge"
Um, Henry, what does this even mean?
Quite simply, their actual loss ratio was almost 10% higher than last year's (loss ratios are metrics of how much is paid out versus premiums paid). That's not exactly a prescription for long term financial stability. A big part of the problem is that those on claim for cognitive impairment (eg Alzheimer's and the like) are living longer, which is nice (kind of) for them, but a direct impact on the insurer's bottom line.
Which may mean another round of rate increases.
The challenge,of course, is that as we age we tend not to get healthier, and the odds of having such a claim increase each year. Which begs the question: how is this affecting carriers' bottom lines?
Well, we have one answer here, thanks to co-blogger Bob:
"Unum Falls as Long-Term Care Loss Ratio May Prompt Reserve Charge"
Um, Henry, what does this even mean?
Quite simply, their actual loss ratio was almost 10% higher than last year's (loss ratios are metrics of how much is paid out versus premiums paid). That's not exactly a prescription for long term financial stability. A big part of the problem is that those on claim for cognitive impairment (eg Alzheimer's and the like) are living longer, which is nice (kind of) for them, but a direct impact on the insurer's bottom line.
Which may mean another round of rate increases.
Or not:
from InsureBlog https://ift.tt/2HEbrHE
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