LTC Riders May Be the Future of the Industry

Standalone long-term care insurance products have seen disappointing sales in recent years while combination products, or riders, have seen significant growth. These combination products may be the future of the industry, according to a study by Conning.

Conning analyst, Terence Martin said, “The need for long-term care Insurance is growing as the population ages, life spans lengthen, and the cost of skilled nursing and assisted living accelerates. However, standalone long-term care insurance products have not found acceptance with the consumer due to ongoing premium rate increases on new and existing policies and the uncertainty of ever receiving a benefit.” The low interest rate environment has hurt insurers’ investment returns and has accelerated exits from the market in recent years.

In contrast, long-term care riders on life insurance or annuity policies, have seen increased sales and may represent a more acceptable risk profile for insurers.

Stephan Christiansen, director of research at Conning said, “Insurers saw an opportunity in the long-term care market to meet a significant consumer need, but have largely been unable to sustain a viable business model in standalone products. Even though combination products have a higher premium than standalone products, the greater certainty of receiving a long-term care or life insurance benefit is resonating with consumers, and the product is beginning to break through in terms of sales success…They do represent a…more acceptable risk profile to insurers. The question remains…whether the many structural issues…that have plagued insurer’s standalone products will also affect growth and profitability of combination products.” For more information, visit

Last Updated 05/25/2022

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