estate planning | investing | portfolio spotlight | real estate | retirement | RISk MaNagEMENT | tax planning

The policies are getting re-evaluated by people in the post-Covid age .

By Ben Mattlin

“ There are more types of LTC insurance solutions than ever before ,” says Marc Glickman , an actuary and CeO of BuddyIns , a Calabasas , Calif . -based community of long-term-care insurance specialists .

The industry has certainly gone through growing pains . About 50 years ago , when long-term-care policies first became widely available , there were as many as 100 carriers ; today there are only about a dozen . One by one , they exited the business as customers lived longer and healthcare expenses grew .

But those that remain may be better and stronger than ever .

Pricing Improvements

“ The policies today are priced realistically ,” says Brian Gordon , president of Murray A . Gordon & Associates / MAGA Ltd ., a long-term-care specialist firm in Bannockburn , Ill . “ The carriers have learned from their past missteps of underpriced , benefit-rich plans .”

In fact , he says , rates may be coming down . That ’ s partly because of rising interest rates . Insurance companies typically park their assets in fixed-income instruments . When rates were low , the companies had to raise premiums to make up the difference . Not any longer .

“ With the higher interest rate environment ,” says Gordon , “ we are just starting to see some carriers lower their premiums slightly on new business .”

Tougher Underwriting Requirements

Yet Gordon concedes that the coronavirus pandemic has affected the industry , too . “ I ’ ve found the underwriting to be a bit tougher ,” he says , referring to the standards used to determine who can qualify for coverage .

Besides coming up with a longer list of policy exclusions for people with pre-existing conditions , some carriers have temporarily restricted coverage for anyone who has lived in or recently traveled to high-Covid areas .

On the other hand , the pandemic has contributed to higher demand as awareness of the devastating effects of protracted health problems has grown .

Another recent demand driver : stock market volatility . “ Those who felt confident that they could pay for LTC out of pocket are no longer as confident and therefore are looking at LTC insurance ,” says F . Michael Zovistoski , a managing director at UHY Advisors NY in Albany , N . Y .

State Mandates Politics has played into rising demand as well . First , in 2019 , the state of Washington passed the Long-

50 | financial advisor magazine | september 2022 www . fa-mag . com