The long-term care insurance industry paid out $3.5 billion in benefits to individuals holding long-term care insurance policies in 2007 according to a study released by the American Association for Long-Term Care Insurance. Approximately, 180,000 Americans received benefits. The AALTCI compiled the data from over 60 long-term care insurers who represent 98 percent of all policies currently in force. This is the first time the total number of individuals on claim was gathered.

The risk is higher of needing long-term care than the risk of a serious car accident or house fire. Baby boomers as part of the “sandwich generation” are beginning to understand the importance of planning for long-term care needs. Long-term care insurance isn’t nursing home insurance.

The Association’s (AALTCI) study of claims for 2007 showed that 43.0 percent were attributed to home care. 32.9 percent of claims were for assisted living and 24.1 percent covered home care. It also found that the individuals receiving benefits are older. 32.3 percent receiving benefits are between 70-79, 55.2 percent are between 80 or over, but 11.5 percent were for those between 50-69. The youngest individual on claim was 23.

Retirement planning needs to include long-term care planning because unless an individual is guaranteed through group long-term care insurance, you will need to health-qualify for coverage. That’s why it is important to start planning when individuals are in their 50’s. An individual is far more likely to qualify for significant good health discounts when they are in their 50’s than if they wait to purchase coverage in their 60’s.

The five most common reasons for a long-term care insurance claim, according to the Association, are Alzheimer’s disease, stroke, arthritis, circulatory issues or injury. Fifty-one percent of American children and adults are regularly taking one or more prescription drugs for a chronic condition, typically for problems linked to heart disease, obesity and diabetes according to a recent survey conducted by Medco Health Solutions.

According to the Association, after looking at the records of major insurance companies and 250,000 consumers, it found that 22.9 percent of those 60-69 were turned down for a policy. In your 50’s, only 14 percent were rejected. Yes, it’s true you will be paying for the policy for more years, but at a lower premium. But at least you’ll qualify and have a policy.

In conclusion, we can’t predict our future. Medical advances are increasing as well as our life span which means that most of us can expect a longer life than our parents. This increases the likelihood that we will need some kind of long-term care. So, don’t put off this very important aspect of your financial plan. Consult with a Long-Term Care Specialist to find out what the best plan is for you and your family.