Adult Children, Aging Parents Have Different Views On LTC: Study

Gillan says, "most people are ill-informed, so decisions come rapidly and under duress." Getting people to see the value of LTC insurance before a need arises can be part of the answer, he says. To this end, carriers should design products in a way thats more palatable to younger people, suggests Gillan. Specifically, LTC insurance could be integrated with term life insurance.

One problem that hinders purchase of LTC is that adult children have growing children of their own, are saving for college educations, and paying for life insurance. Often, say experts, they feel they have much to pay for as is, and, therefore, they tend to delay buying LTC insurance. But "later never comes and its always hard," Gillan says. On the other hand, he says, "I would find it appealing myself, if an insurance carrier would show me that when Im younger the premium is lower, as opposed to taking it when Im older."

In a product that integrates LTC insurance with term life insurance, a carrier could prescribe a premium level per year that will provide term life insurance but, at a certain time of the clients choosing, it would start integrating LTC insurance, he says. People would have the option of beginning LTC insurance at whatever age they choose, but would likely do so when their children have graduated college, Gillan says.

The idea is that LTC insurance can be designed with many features that would encourage people to buy it at a younger age, he says.

The studys findings are not surprising, comments Paul V. Engel, regional LTC specialist in Houston for CNA. The study shows that if older people have misconceptions about paying for LTC insurance, their children are less well informed than they are, he says.

In his practice, he has noticed that older clients have three concerns: "choices, peace of mind, and they dont want to be a burden." The vast majority of clients are older than age 50, he points out, "so we dont see a lot of people buying (LTC insurance) for their parents," Engel says. "The kids dont understand the problem, and most of the literature is directed to seniors."

Engel says its not the products that need changing, but the group that LTC insurance marketers are targeting. "The products do a great job of handling care needs, so we may not be sending the message to the right people," Engel says. "We should include adult children in conversations with their parents about LTC insurance needs."

This article first appeared in the September 2002 edition of LTC e-Wire, an online publication of National Underwriter Life & Health.

Reproduced from National Underwriter Life & Health/Financial Services Edition, October 7, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.