Louis H. Brownstone

What is the state of long term care insurance? It’s hard to say. The need for this unique protection is growing as our citizens age but, in my opinion, discussion about long term care has diminished. The insurance industry has failed to provide a long term care solution which is being accepted by the public.

However, changes are happening, and we may shortly see a rebirth of this product. Let’s first examine the reasons for the lessening of our conversation about long term care. Then let’s look at the potential for future growth.

The Reasons
First, the long term care insurance industry made some critical errors in pricing the product a generation ago. It assumed that the high interest rates of the last part of the twentieth century would continue into the twenty-first, but interest rates have moderated. It assumed that lapse rates would be six or seven percent, similar to the life insurance industry, but they have been one percent. It assumed an insufficient utilization factor of the insurance, as claims turned out to be higher and of longer duration than projected.

These assumptions resulted in a severe underpricing of the product, and this led to large rate increases which are still occurring. The design of the product should probably have mirrored health insurance where the initial premium would have been low and small annual rate increases would be assumed. This structure would have given the product more initial pricing appeal and acceptable pricing flexibility.

Many agents were encouraged by the representations of a major carrier which boasted of no previous rate increases, and assured their prospects that rates would therefore hopefully not increase over time. This turned out to be misleading and incorrect.

The result was income losses for the carriers and a public relations disaster. Over a hundred insurance carriers exited the industry, and some even went bankrupt. The industry was considered to be untrustworthy and more concerned with its own profits than the welfare of its policyholders. Today’s rates are considered to be too expensive and still unreliable. Overlooked are the billions of dollars paid out in claims and the many stories of people whose assets have been protected.

Second, the overall social and political environment has discouraged people from thinking about their long term care needs. These issues have become uppermost in our minds. The main current motivation of many Americans is just trying to pay their bills and reducing their debt. For them, the future will have to wait for a calmer and more prosperous period.

Finally, the cost of long term care protection has become so high that, thus far, federal and state governments have been unable to provide a solution. Many bills to cover the costs of care have been introduced, and there has been some helpful legislation around the edges including the creation of public-private Partnership policies. The legislation which came closest to providing a significant long term care solution was the federal Class Act ten years ago, but it failed for lack of funding. Many bills have been introduced each Congressional session since, but have gone nowhere.

Meanwhile, the insurance industry has attempted to find solutions other than traditional long term care, sales of which are five percent of what they were fifteen years ago. Hybrid life and annuity/long term care insurance policies have provided an expensive but useful solution to two different needs at the same time. At least 30 percent of life insurance policies now have long term care riders or chronic illness riders. These products have resulted in increased sales, although in many instances, a chronic illness rider is bought as a nice extra to a life insurance policy and not as an important component. These new products could cause a revival of public interest in long term care solutions, but most people cannot afford their cost.

The Potential
Now let’s discuss the potential for future growth. The cost of long term care has become too high for either private insurance or any government to provide a solution for the vast majority of Americans. There needs to be a true public/private partnership which could share the cost, now well into the hundreds of billions of dollars annually. We now have a fresh example of how this public/private partnership could evolve.

Last year, the State of Washington passed the Washington LTC Trust Act and established the Washington Cares Fund. This mandatory program, now slated to begin on July 1, 2023, imposes a .58 percent payroll tax for all adult W–2 employees in Washington State. This would pay for some long term care services for a short period, increase the long term care conversation, and encourage citizens to purchase wrap-around private long term care insurance

The only way to permanently opt-out of the payroll tax was to have other long term care insurance in force by November 1, 2021. Washingtonians do not pay income tax and rebelled against the idea of being taxed. About one-seventh of the eligible population, almost 500,000 people, suddenly bought private long term care insurance, and many others couldn’t buy it because carriers were overwhelmed and ceased sales.

However, many people only bought private long term care insurance in order to opt-out of the tax, not to buy long term care protection, thinking they could lapse their policies early in 2022. It now appears that the State will amend the Act to include some recertification of policies, and a lapse will lead to an imposition of the tax.

The combination of a public and a private long term care insurance program is very complex and contains a number of imperfections. Nevertheless, the Washington LTC Trust Act appears to be on its path with some revisions to implementation. If it works, it will save the State many millions of Medicaid dollars and provide at least a partial long term care solution to its citizens. It will become more popular over time as people receive its benefits and augment their coverage with wrap-around private insurance.

Twelve other states are now considering programs similar to Washington State’s, including the large states of California, New York and Illinois. California has created a Long Term Care Insurance Task Force which is directed to report its recommendations to the Governor and the Legislature by the end of the year.

Thus far, it appears that the California Task Force will recommend an opt-out provision similar to that of Washington’s, allowing opt-out only before enactment of the bill. If this occurs, I believe that as was the case in Washington, there will be a new gold rush in California…to buy long term care insurance and opt-out of the tax. The Task Force still has to wrestle in 2023 with the high-cost issues, sensitive in a State with such high taxes as it is. It will probably have to cut the cost of the current recommendations by as much as half in order to have a plan which would be politically acceptable. Passage by the Legislature and signature by the Governor are still many months away, but in my opinion, passage is likely.

If either California, New York or Illinois pass an act similar to that in Washington, major changes will occur. Other states will do the same. There will be large efforts to educate the public and much conversation about long term care will ensue. Carriers will design new wrap-around policies, and long term care sales will increase dramatically.

This change is not going to happen overnight. Legislation will take time. Carriers may be slow to adjust. It may take several years before the long term care insurance industry becomes a significant part of our conversation. However, the potential for major growth exists. The seeds for change are beginning to germinate. Stay tuned!

This country is in a dour mood in my opinion. This dour mood is due to a number of causes, and it can easily affect us all, dampening the positive attitude that sellers of insurance products need to convey. Some of us are good actors and can overcome our frustrations, but others are more serious about their concerns and cannot avoid revealing this in their presentations.

We’ve become a nation of complainers in my opinion. This is especially true when we talk about politics. Politicians now highlight shortcomings of the other party. Starting fights over alleged issues seems to work better for their chances for election than asking voters to credit them for their own achievements. The effects of these fights on our psyches are real.

There are so many things we should be grateful for. How have we gotten into such a rut?

If one looks on the negative side of life in the U.S. right now, there are plenty of problematic issues. Here’s my top ten, by no means a complete list:

• President Trump tried to retain power and threatened our democracy;
• Republicans vs Democrats is splitting the country in and out of Congress;
• Putin is a major threat to our world order;
• Russia’s Ukraine invasion could continue for many months;
• We are not doing enough to control climate change;
• Inflation is eating into our standard of living;
• Our race relations are still terrible;
• Income inequality is huge and increasing;
• COVID may be with us permanently;
• Thousands of Americans are needlessly shot and killed.

There’s a great deal to worry about. We often talk about these issues with our relatives and friends, revealing our emotions and concerns. We can now chatter about the world’s problems on Facebook and Twitter. We view horrific scenes on TV of war in Ukraine and starvation and floods in Africa. Newspapers, magazines and social media highlight these issues and keep them before our minds. Technology has made us closer to the world’s problems than we have ever been, and we can witness horrific events.

But before these issues cause you sleepless nights, you should look at the issues that you can feel really good about: Here’s my top ten, by no means a complete list:

• We live in the U.S., the greatest country in the world;
• We have freedom of speech and can advocate for our views;
• We can do with our lives as we choose;
• We have the richest and most robust economy in the world;
• Two great oceans insulate us from wars;
• Our climate is generally temperate, and in some places nearly perfect;
• We can receive joy from the love of our families;
• Our country practices the rule of law;
• We have freedom of religion;
• We can eradicate almost all disease and increase our life expectancy.

With all of these wonderful things in our lives, why have we become so negative in our outlook? Our media should be rewarded as much by making us feel good as by making us feel bad. If you’re feeling burdened by the world’s problems, depress your concerns and lift yourself up with things that make you feel good.

Get uplifted by listening to a beautiful symphony or a terrific rock concert. Enjoy the beauty of the outdoors and get some healthy exercise. Get with your family and friends and relax in their company. Plan to travel to a place which will stimulate you and make you feel good. Receive uplift from your religion and keep in front of mind all the wonderful advantages that God has given you.

Then go out and share your joy with others. Plan to utilize your talent to make life better for others. Show the happiness which you have in presenting great insurance products which will protect policyholders and grow their assets. Become an ambassador of the many positive things that make our lives worth living.

The bottom line is that the issues we can feel really good about dwarf the problematic issues. We’re lucky as hell, and our mood should be upbeat and positive, not dour.

The Washington Long Term Care Trust Act is a minimum long term care insurance solution for almost all of the citizens of Washington State. It will be funded beginning in January through a mandatory payroll tax of .58 percent on all W-2 earners in the state. This will give workers a lifetime benefit of up to $36,500, adjusted annually for inflation by Washington’s Consumer Price Index. There is a wide range of benefits, both at home and in facilities, based on the need for assistance in three of ten activities of daily living including cognitive impairment. The self-employed are given an option to opt-into the program, and citizens with private long term care insurance are given a very limited option to opt-out by November 1, 2021.

The concept here is to provide a small long term care benefit and to encourage citizens to buy wrap-around private long term care insurance. This would protect citizens and save the state many millions of future Medicaid dollars.

In my view this noble effort, guided by actuaries from Milliman, got many things right in its design. It’s a mandatory program. It is funded by a progressive tax, so that the poor pay very little and the very rich can opt-out. Its benefits are far-reaching. It has a seventy-five year vision to adjust the program to ensure its financial solvency. It will be administered in a hands-on manner by Washington State government personnel.

However, the Washington Cares Act has run into some difficulties as well. There was strong public opposition to the imposition of the tax, despite the fact that the legislature approved it. No one likes to be taxed. The regulations included the fact that citizens who moved out of state would forfeit their contributions to the fund. In addition, citizens who live out of state, say, in Oregon or Idaho, but work in Washington, would have to move to Washington in order to receive their benefits.

Because of these reasons, there was a huge rush by citizens to purchase private long term care insurance in order to opt-out of the tax. The insurance carriers suddenly got deluged with applications and could not cope with the volume. Many applications were for very small benefits and premiums. The carriers were thus concerned that applicants would cancel their policies once they could show the Washington Cares Act that those policies were in force, as there was no planned recertification that these policies continued to be in force. In addition, applications for small benefits are generally unprofitable due to the costs of underwriting and administration. Consequently, the carriers ceased taking applications almost three months before the closure of the brief opt-out option.

What can others learn from the Washington Cares Act experience? The main take-away is that in its efforts to be all-inclusive and ensure its solvency, the designers of the Washington Cares Act included some elements which were not well accepted by its participants and which might need some revising in the future. The problem is that many of these revisions would result in a shortfall of revenue and could necessitate an increase in the tax.

Here are some areas of concern which need further investigation. First, and above all, there needs to be greater cooperation with the insurance industry. This would include a far longer period to be able to opt-out. There should also be minimum benefit requirements in order for a policy to qualify as an opt-out policy. The insurance industry should also be compelled to recertify opt-out policies on a regular basis in order for a policyholder to retain their opt-out status. Otherwise, the tax would be imposed on them.

Second, Washington State’s citizens should not be penalized if they move out of state. They should at least receive a refund of their premiums. With this method Washington could retain any increases from the inflation clause to cover their administrative costs.

Third, Consumer Price Index inflation may become a weak method to keep up with the rise in the costs of care. In the present environment, CPI inflation is about two percent, and the increase in the costs of care is about four percent. In thirty-six years, at these rates, CPI inflation would result in a $ 200/day benefit in the Cares Act, but a four-hour home care cost of $120 now would increase to $480. The Cares Fund would then pay for less than two hours of home health care. This gap would continue to grow over time. A new method needs to be created to keep up with the rise in the costs of care.

All of these revisions would affect the size of the tax required. I believe that there would be little objection to the increase in the tax so long as the total remained under one percent. There may be other ways to cushion the need for a tax increase, such as inserting a small elimination period before one could receive benefits.

Other states have become very aware of the Washington Cares Act, and there are a number of them, including states with large populations like New York, Illinois and California, that are investigating legislation of their own. California may be the most advanced in their thinking and organization, as it has established a Long Term Care Insurance Task Force which has met three times. The California Task Force intends to submit its recommendations to the Legislature by the close of 2022.

If other states use the Washington Cares Act as its model, which I believe they will, they will attempt to overcome its shortcomings. I have submitted ten recommendations to the California Task Force as a starting point for discussion and revision. I hope that this and input from others will guide the Task Force in creating a program which will benefit many Californians and be adopted in other states. Here are my recommendations:

1. Extend the Opt-Out Provision period to at least two years to enable the insurance carriers to handle the crush in applications. California’s population, for instance, is five times that of Washington’s.
2. Enact minimum requirements to qualify as an Opt-Out policy. Suggestions:
   a. Traditional LTCI…$150 daily benefit, 730 day benefit period, three percent compound inflation.
   b. Linked life/annuity with long term care rider…$250,000 death benefit with equal long term care rider.
   c. Life with long term care rider…$250,000 death benefit with equal long term care rider.
3. Recertify Opt-Out policies at least every other year.
4. Promote Opt-In for self-employed and include spouses.
5. Include either a 30-day or 45-day elimination period to cushion the size of the tax.
6. Include reimbursement for members who move out of state, either with a refund of premium cost or the current value of the account.
7. A new formula needs to be created to keep up with the rise in the costs of care.
8. Senators of a state should fight in Washington, DC, for Federal matching funds.
9. Include some of the regulatory elements of a state’s Partnership for Long Term Care program.
10. Don’t call it a tax…call it a premium, a payment, an assessment…anything but a tax.

Others should feel free to weigh in with their recommendations to the Task Force. We should all pull together to create a good program to at least partially solve the long term care conundrum.

It’s time to face the facts. The insurance industry understands the long term care problem but has not provided an acceptable solution for millions of Americans.

Long term care is becoming an even larger elephant in the room. First, the numbers of Americans needing this care are increasing as their average age increases. Second, the high costs of care continue to rise faster than the rate of inflation. How can insurance protect Americans from these huge costs?

The insurance solutions have become inadequate. Traditional long term care insurance products are becoming more and more expensive in order to cover, or partially cover, the increases in the costs of care. Furthermore, the rates are not guaranteed. Hybrid life/long term care and annuity/long term care products are becoming more popular than traditional long term care products, but they are even more expensive.

These are solutions that only Americans in the top ten percentile of income and assets can afford to buy. What about the other ninety percent? What are the solutions for them? They must use up their limited assets and become dependent on family members, Medicaid and other government programs to receive the care they need.

As costs of care and long term care insurance premiums have risen, agents and brokers have had to make significant compromises in benefits. These compromises used to be relatively small, making partial coverage adequate in most cases. But today, most policies now being sold leave increasingly broader coverage gaps. Let’s examine these gaps.

Daily Benefit: With nursing home costs at $300 per day and more, many brokers and agents are not even trying to fully cover nursing home costs. They know that people will prefer to stay at home, especially when COVID-19 illnesses and deaths permeate nursing homes. The compromise is to design policies with daily benefits of $150 to $200 per day which can cover or almost cover eight hour per day home care costs and all assisted living facility costs. This type of plan cannot fully cover twenty-four hour per day home care. It assumes that people will enter nursing homes only as a last resort and only for a short period of time. Because of the increase in home care usage, brokers and agents are tending not to utilize a reduced percentage benefit for home care and assisted living care.

Benefit Limit: Most people would prefer lifetime coverage, but it is too expensive and is virtually unavailable as an option. Even four to six-year benefit limit options are rarely utilized. The compromise is to design policies with two and three-year benefit limits. Shared care is often utilized for couples in order to potentially double the benefit limit if only one of the spouses needs benefits.

Inflation Rider: Insurance carriers have priced five percent compound inflation, the original standard rider, out of the market. The current rate of increase in long term care costs is about four percent, and this rate could go up a bit with future increases in the minimum wage. The compromise is to propose three percent compound inflation or five percent simple inflation. Another compromise is to shorten the inflation period to a defined period of ten to twenty years. Another alternative is to create a large daily benefit with no inflation rider.

Elimination Period: Brokers and agents are almost always proposing a ninety-day elimination period. They may also include a zero-day home care rider, but with a fair-sized increase in premium. Days utilizing the zero-day home care rider often do not count against the facility elimination period. The ninety-day compromise helps lower the cost, but policyholders are often quite upset when they have to wait ninety days in order for their policy to pay a full benefit.

As an example, (see Table 1) let’s examine the annual premiums in most states today for a major carrier’s traditional long term care insurance product with these compromised benefits: A monthly benefit of $4,500, a benefit limit of $160,000, three percent compound inflation and a ninety-day elimination period:

It has been said by many marketing experts that an annual long term care insurance premium needs to be under $2,000 per year in order to appeal to many Americans and encourage them to purchase long term care insurance. In this example, one has to be in their forties to get the annual premium under $2,000, and, at age 45, that only applies to a single male.

The average age of the traditional long term care insurance purchaser has been about age 57 for years. No wonder that sales have decreased so dramatically over the years. People in their fifties and sixties are not motivated to invest in these high premiums. People in their forties have many competing demands on their finances.

Now let’s discuss the hybrids. The hybrid advantages over traditional long term care insurance are twofold: 1) one always receives a benefit; and, 2) the rates are guaranteed. Hybrids are more expensive than traditional long term care insurance, but you are buying two desirable products which can interact with each other.

However, as with traditional long term care insurance, agents and brokers have had to make significant compromises in benefits so that policies now being sold only partially cover the costs of care and leave increasingly broader coverage gaps. The main compromise is to exclude an inflation rider. Other compromises are to provide a relatively small death benefit and exclude a lifetime extension of benefits rider.

Let’s compare by examining the annual premiums in most states today for a leading hybrid life/long term care insurance product. I am using this particular company because I can structure three percent compound inflation on both the death benefit and the rider, so that the benefit increases over time at the same rate as the example for traditional long term care insurance. This will still not be an apples-to-apples comparison to the traditional example above, but it brings the hybrid example closer to that example.

Let’s use an $80,000 death benefit, an $80,000 continuation of benefits rider with three percent compound inflation lifetime on both. (See Table 2)

Here, there is no annual premium under $3,000. You have a product which again is too expensive for the 90 percent of Americans.

If both traditional long term care insurance and hybrids now in the market are too expensive for 90 percent of Americans, what is the solution for them? I envision three possibilities.

First, Partnership plans can be a great solution if they are utilized properly. They were originally intended to be sold to people with moderate income and assets. Unfortunately, they have not worked well recently because many of the original restrictions on the policies have made them unaffordable and uncompetitive.

Recent changes in these restrictions have made Partnership plans more affordable and again appropriate for their target audience. These changes have included lower inflation rates, smaller monthly benefits and smaller benefit limits. People can purchase a Partnership plan with these smaller benefits, use up these benefits, wind up on Medicaid, and protect some or all of their assets. Partnership policies are a fine example of a private/public partnership which can work for millions of Americans.

Second, the State of Washington Long-Term Care Trust Act may be the first potentially successful attempt at a public plan. Passed in May, 2019, it provides for a benefit of $36,500 which will be indexed for inflation. It will be funded by a .58 percent payroll deduction. This small benefit will provide very partial coverage, but the State will encourage members to purchase private long term care insurance as a wrap-around. The wrap-around will cost relatively little because the Trust members will be relatively young and the first months of benefits have been provided by this Trust Act. Other states are aware of what Washington is doing and may follow suit.

Third, a revision of the structure of traditional long term care insurance may create lower initial premiums and encourage Americans to purchase a plan. Here premiums could be set a low base and rise slowly every year, similar to health insurance.

The rate of increase should be variable based on actuarial experience. We now have sufficient experience so that these increases should be in the low single digits. This plan would reduce the original cost significantly and create a broader market. One current example provides for an automatic percentage annual increase in premium, but lacks an increase based on actuarial experience. Actuaries would probably be more comfortable with a variable rate of increase, but may also have to factor in an inflation factor.

These three potential solutions show that the industry is not satisfied with the current models and is searching for a new solution. I believe that this process will take ten years, and that the industry solutions will be far different by 2030 than they are now. The need will be far larger by 2030. We had better solve this problem.

The COVID-19 virus entered the United States as early as December and created consternation by mid-March. Its effects have been huge and have caused panic and uncertainty. We have not only sheltered in place but mentally have frozen in place trying to adjust our lives. Now that a few months have passed we have learned a great deal, and we still don’t know a great deal.
But maybe enough of the fog has cleared that we can predict the future with at least some modest degree of accuracy. This article will attempt to foresee the future of long term care solutions as reflected in the eyes of government, insurance carriers and prospects. We will only know years from now how accurate these predictions are.

Government:
Enormous deficit spending and lower tax receipts will create major challenges for local, state and federal governments. They will have to cut back and eliminate many programs that citizens want them to provide. It is likely that we will be in a very low interest rate environment for many years. Government debt will become dangerously high. The Federal Reserve Board has reduced interest rates to almost zero in order to stimulate borrowing, and Congress has responded. The Federal Reserve Board has many levers to control the rate of inflation, and it will utilize all of them to keep interest rates low and to stimulate the economy.
An extremely important election in November will determine our future. The country is divided and, as of this writing, President Trump’s reelection is in serious jeopardy. He will not have the advantage of defending economic prosperity and he has made some very bad moves recently. A lot can happen between now and November, but I am going to assume that Vice President Biden will win the election.
As President, Biden will be compelled to raise income taxes for the very rich in order to reduce deficit spending. Even so, he will initially be limited in proposing spending for social causes, just because the money isn’t there. His actions may be further limited if the Republicans still control the Senate.
He will campaign on health care as a major issue and will advocate a government health care option, not Medicare for all. It’s questionable whether such an option would include long term care benefits, due to the high cost of coverage. My sense is that if long term care benefits become a part of a government health care plan, it will either be a minimal benefit and/or it will be a rider and not be a part of the base policy.
Health care is such a complex subject that it will be fiercely debated and it could take years before a new government plan could become law. Such a law would have to overcome the objections of insurance carriers, medical providers, hospitals and the device makers. The public would have to overwhelmingly support such a plan for it to gain traction and succeed. The Affordable Care Act took years to enact, and I foresee similar conditions now.
One wild card here. If the Republican Party loses the election badly, it will have to reinvent itself in the face of increasingly unfavorable demographics. In this process, it could reject the extreme right philosophy that it has adopted under President Trump and move towards the political center. That could dramatically alter the future and make social changes more likely.

Insurance Carriers:
Despite the increasing need, sales of traditional long-term care insurance policies have been declining for years, some 85 percent down from the early 2000’s, and this product is now recognized by insurance carriers as an unprofitable loser. This is still true in spite of the fact the premiums are up to three times what they were decades ago. With one or two exceptions, the insurance carriers have lost all economies of scale, and at today’s sales levels they can’t make much money if any regardless of what they charge.
In addition, with the very low interest rate environment forthcoming, their interest rate assumptions, already low, will still be higher than projected future income from safe investments. They will either have to make riskier investments or seek further rate increases, even on current products. There may also be more pressure on their reserves.
We still don’t know the long-term effects from COVID-19 on people’s health, especially the health of the older population. What are the implications for one’s kidneys, liver, lungs and heart? Will insurance carriers have to factor in unknown potential claims resulting from the long-term effects of this disease?
These factors have led to the insurance carriers being far more comfortable selling hybrid life/long term care and annuity/long term care products. There has also been a large growth of life insurance policies with accelerated benefit riders, usually for chronic illness. The distinction of benefits between these chronic illness riders and traditional long term care insurance has become very small. Now some 40 percent of life insurance sales include riders which cover long term care costs.
The risks in life insurance and annuities are far better known than the risks associated with traditional long term care products. These riders have become the main vehicle to protect people against the largest threat to their retirement.

Prospects:
The initial reaction of Americans to COVID-19 was to become scared and feel threatened and unsafe. We retreated to our homes and ceased many of our normal activities. We also had to learn to perform many routine functions differently and this required a significant mental adjustment. Now was not a time to think about the future but to worry about the present and make sure that our changed lifestyle would provide for us the best chance of surviving the pandemic.
It’s obvious that the pandemic has resulted in horrible publicity for nursing homes, where many patients have become sick and died. It’s even more difficult now to envision anyone interested in nursing home insurance, or even long term care insurance with its history of caregiving in nursing homes and assisted living facilities. Almost everyone will want to be cared for at home instead. It’s actually a small mental difference from “sheltering in place” to “nursing care in place.” Life insurance products which cover long term care costs provide less of this nursing home stigma and will be more readily accepted.
This nursing home stigma may require a change in long term care product marketing to become something like “home caregiving insurance,” rather than long term care insurance, even if it includes benefits for care in nursing homes and assisted living facilities. There will have to be a large increase in both the number of caregivers and in their compensation due to the rejection of nursing homes and the rising demand of folks to stay at home.
Now that a few months have passed, and the methods to fight this virus have become better understood, we have become less fearful and are beginning to resume some of our normal activities. We can even envision a time when we will be able to adjust to whatever the new normal is and go on with our lives. This may take a few months longer, and a second wave of the pandemic could slow this adjustment, but it will happen eventually.
This could cause a long-range change in our thinking from the immediate crisis to a longer view of our needs. At that time we will consider protection to be the basic need that it has always been. Protection can take many forms, but we will mostly want to protect our families against loss of income due to death and expense due to bad health.
Therefore, I envision a slow but steady growth of hybrid life/long term care insurance and life insurance with long term care riders or chronic illness riders. This could take up to ten years to occur, but many will recognize the need for this protection and take action to protect their families.
Our current system of health care is unsustainable and we all know it. I foresee a completely different system in place by 2030 with some sort of health care for all. It’s going to be interesting to see what form it takes. Stay tuned. 