LTC Ranks High In Benefit Lineup

June 9, 2003 ( - US workers now rate long-term care coverage as high as a group life policy when evaluating company benefits, a new survey found.

According to Prudential Financial Inc’s 2003 LTC Insurance Employee Benefit Study, 62% of workers polled said they would think about long-term care insurance as a voluntary benefit if their employers offered it. Furthermore, more than eight out of 10 (82%) would consider buying coverage if their employer subsidized a portion of the cost. The importance of the employer contribution is emphasized by the fact that the number of employees who would “definitely” buy LTC insurance doubled from 14% when the coverage is not subsidized to 30% who said they’d opt for coverage with financial help from the employer.

Employees may be interested, but the survey found that many still need better information and education to determine if LTC insurance is right for them Today, more than half (56%) of consumers are not familiar with the benefits or features of long-term care insurance, and a scant 14% feel very familiar with the product. As yet, 30% have talked with a financial professional to better understand whether this product is right for them.

Government Coverage Misconceptions

The lack of knowledge is compounded by misperceptions. Two-thirds (62%) of middle class and affluent Americans believe, or are unsure whether government programs would cover the cost of a nursing home care or a home healthcare aide, if they were no longer capable of caring for themselves.

Workers are also beginning to connect the benefits of long-term care Insurance to protecting their retirement assets The annual bill for nursing home care averages $56,000 or higher in urban metropolitan areas and that could wipe out a lifetime of retirement savings in a matter of a year or two for many workers, Prudential said.

Prudential Financial polled 300 individuals 25 years old to 65 years of age, employed full-time or part-time by companies with 500 or more employees and reporting an annual household income of $40,000 or more. The survey was conducted in March 2003.