The largest long-term care insurance claim has reached $1.8 million in paid benefits, according to a study by the American Association for Long-Term Care Insurance.
The claim is for a woman who has received benefit payments for 15 years and nine months as of Dec. 31, 2012. The largest claim made by a man now exceeds $1.3 million in paid benefits, the association said. The woman's claim started three years after she purchased a long-term care insurance policy.
"Consider that she paid $881 yearly for the coverage with payments ending when her claim began," Jesse Slome, director of the American Association for Long-Term Care Insurance, said in a press release.
Although no one hopes to have to make a claim on a long-term care insurance policy, Slome said, "If you need care for a few months or for many years, benefit payments from your insurance can help relieve the financial and emotional toll that so many families face."
Long-term care insurance companies paid $6.6 billion in benefits in 2012 to a record 264,000 individuals, according to the association. About half of newly opened claimants received benefits for covered home care services with the rest paying for care in assisted living communities or skilled nursing homes.
According to the organization's study, most of new long-term care insurance claims in 2012 started after the policyholder was age 70, and more than two-thirds began after the policyholder turned 80. The most common reasons for a long-term care insurance claim are Alzheimer's disease, stroke, arthritis, circulatory issues or injury.
The trade group recommends consumers shop for long-term care insurance before age 65. The older one gets, the greater the chance of developing a health issue that makes it difficult to qualify for coverage.