Actuaries for long-term care insurance (LTCI) issuers know that everyone is looking to them for answers about how COVID-19 has affected, and will affect, LTCI claims.
But two actuaries who spoke Tuesday at the ILTCI Conference said getting good pandemic-period experience data will take time.
When news of the pandemic first appeared, in early 2020, "we had so many unknowns," said Rachel Erne, a PwC managing director. "Now, it feels as if we have even more unknowns … There's just more and more questions."
Nick Sheahon, senior director for long-term care in-force pricing and modeling at Genworth Financial Inc., said the answers may vary widely from insurer to insurer.
"In the end," Sheahon said, "each carrier is going to have different experience."
Executives from Genworth and other LTCI issuers that are public companies have told securities analysts that COVID-19 reduced claim costs in 2020.
Public companies said the pandemic cut spending on claims by:
- Killing some insureds who were using their LTCI benefits, and shortening the amount of time those insureds spent using their benefits.
- Causing some LTCI insureds who were staying in nursing homes and assisted living facilities to move into private homes and use home care, or to rely entirely on help from friends and relatives.
- Keeping some insureds who became eligible for long-term care benefits during the pandemic from starting to use paid long-term care services.
PwC conducted surveys of about 15 other LTCI issuers. Answers varied from company to company, but, overall, those participating in the survey seemed to see the same things that the publicly traded issuers have been talking about, Erne said.
Erne and Sheahon said one open question is whether the pandemic will end up increasing future LTCI claims.
COVID-19 itself could cause some insureds to need LTC services, the actuaries said. The virus may have accelerated the deaths of people who were likely to die soon from other conditions and spared healthier older people, the actuaries said.
If that's the case, the insureds who have survived may be healthier people who will live longer, and who will spend more time using LTC services if they need care services, the actuaries said.
