Long Term Care Insurance: Risky Business?

By Michelle Seitzer / Posted on 30 January 2013

Why, in a time when senior housing is so greatly needed and in high demand, are products like long term insurance leaving the market? Find out in today's post.As several types of senior housing are often private pay only, some consumers have turned to long term care insurance as a way to cover the cost. However, recent reports of a downgraded stock rating for Genworth Financial, a major company providing this product, could mean this option is not a sure thing in the long run.

According to this article from Senior Housing News, the rating of NYSE: GNW went from “neutral” to “underperform” this week. Credit Suisse, a global financial services company, says this downgrade reflects “continued uncertainty in the long-term care insurance industry” and may have been the result of Genworth’s increased emphasis on the housing market recovery rather than their life insurance operations.

Regarding the uncertainty this places on the industry as a whole, Genworth is not fully responsible: MetLife and Prudential, other major companies that offered long-term care insurance, also “exited the market in recent months.”

Why, in a time when senior care and housing is so greatly needed and in high demand, are products like long term insurance leaving the market? The article references a report from Moody’s Investors Services that may answer this question: long term care insurance’s “complex structure and the difficult nature of profitably pricing policies.”

Your turn: Do you have a long-term care insurance policy?

There are 3 Comments about this post

  1. Collin Adrews says,

    Regardless of the fact that there is a downgraded incident in this industry, long term care insurance companies are still fighting to help more senior citizens. Offering the best offer they could have so everybody can avail. LTCi industry is not the sector that facing such difficulties. The fact that there are more supporters is a reason enough the rise this for the benefits of our elders. Perhaps people need to see more of this http://www.youtube.com/watch?v=iw-EjletLE4 – long term care policy options


    on 31 January 2013 / 5:43 AM

  2. It is good to hear this positive news, Collin. Thank you for sharing it! Yes, that is true…LTC is not the only industry facing such difficulties. Great points and informative video. I’m glad you stopped by the blog to add these resources and comments!


    on 31 January 2013 / 11:56 AM

  3. eliaspeth says,

    Views regarding this will vary. Some people are too afraid to spend their money and buy an LTC policy. However, some are after long term care benefits and want to have the peace of mind that they will have a pool of money to cover the cost of LTC services once they need these.


    on 09 March 2013 / 10:42 AM


Do you have something to say?