Memo
TO: Name Surname, Vice President of Product Development
FROM: Haoming Cao, Actuary
DATE: Feb. 12, 2017
SUBJECT: A Promising New Product - Long-term Care Insurance
Recent conference discusses a new insurance product, the Long-term Care Insurance. In this memo, I will present the basic features and the future market of this promising new product to you as a reference.
Basic Features of Long-term Care Insurance
Long-term care insurance is designed to cover the expense of long-term care (LTC) services for the insured who is unable to perform the essential activities of daily livings (ADLs) or who cannot safely live alone. It has much larger coverage than Medicare and Medicaid, two main LTC programs in the United States, and covers Nursing …show more content…
The factors that influence the market can be summarized as the following points:
• Rapid Population Aging Problem and Increasing Life …show more content…
Continuous improvement in modern medicine and medical instruments prolongs human life, so unparalleled number of people into old age. The life expectancy today is much higher than any other decades and it causes the growth of the percentage of the elders, but the extension of life does not mean physical independence: It is predicted that more than half of them will require some kinds of long-term care services. Therefore, the rapidly increasing population of the elder leads to a growth in demand of elderly care. Historically, taking care of the elderly is mainly provided by family members. However, the demise of extended family and the nuclear families’ increasing reliance on both spouses’ income make it hard for family members to spend time and money assisting their elders, and thus increase the demand for long-term care.
• The Expansion of the Insured’s Age Range
It is worth noting that the long-term care is not only required by the elderly, some middle-age and youngsters also require LTC services because of accidents or illnesses, such as Alzheimer’s and Parkinson’s disease. The main age range of the insured is between 18 and 64 years old, while the oldest claimant so far is at the age of 103. The expansion of age range implies the improvement on the recognition of the importance of health insurance and greater demand in long-term care.
• Costly Long-term Care
TO: Name Surname, Vice President of Product Development
FROM: Haoming Cao, Actuary
DATE: Feb. 12, 2017
SUBJECT: A Promising New Product - Long-term Care Insurance
Recent conference discusses a new insurance product, the Long-term Care Insurance. In this memo, I will present the basic features and the future market of this promising new product to you as a reference.
Basic Features of Long-term Care Insurance
Long-term care insurance is designed to cover the expense of long-term care (LTC) services for the insured who is unable to perform the essential activities of daily livings (ADLs) or who cannot safely live alone. It has much larger coverage than Medicare and Medicaid, two main LTC programs in the United States, and covers Nursing …show more content…
The factors that influence the market can be summarized as the following points:
• Rapid Population Aging Problem and Increasing Life …show more content…
Continuous improvement in modern medicine and medical instruments prolongs human life, so unparalleled number of people into old age. The life expectancy today is much higher than any other decades and it causes the growth of the percentage of the elders, but the extension of life does not mean physical independence: It is predicted that more than half of them will require some kinds of long-term care services. Therefore, the rapidly increasing population of the elder leads to a growth in demand of elderly care. Historically, taking care of the elderly is mainly provided by family members. However, the demise of extended family and the nuclear families’ increasing reliance on both spouses’ income make it hard for family members to spend time and money assisting their elders, and thus increase the demand for long-term care.
• The Expansion of the Insured’s Age Range
It is worth noting that the long-term care is not only required by the elderly, some middle-age and youngsters also require LTC services because of accidents or illnesses, such as Alzheimer’s and Parkinson’s disease. The main age range of the insured is between 18 and 64 years old, while the oldest claimant so far is at the age of 103. The expansion of age range implies the improvement on the recognition of the importance of health insurance and greater demand in long-term care.
• Costly Long-term Care