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The LIMRA/EY US individual life combination LTC survey highlights the market dynamics, business strategies, distribution landscape, risk management, technology, and operational imperatives shaping the future of combination long term care insurance.
In brief
- A strategic focus on product innovation, distribution and consumer education could help expand market reach.
- Significant investments in technology is critical for improving operational efficiencies and risk management.
- Firms should continue to invest in the development of internal product and operational talent to accelerate product development.
Long-term care (LTC) is a growing concern driven by an aging population and rising health needs. More than half of people turning 65 will need LTC support,1 but many lack the financial resources or insurance to cover it. Public programs such as Medicare and Medicaid offer limited help. Rising LTC costs, especially for labor, are outpacing inflation. Personal savings, family support or private insurance are often insufficient or hard to access.
The traditional standalone LTC market has faced challenges with many carriers exiting the market and consumers experiencing significant rate increases on older products. In response, insurers have embraced innovation by shifting from traditional LTC insurance to offering life insurance products with LTC benefits, broadly known as combination LTC products. These hybrid offerings are now the leading private LTC insurance solution, combining financial protection with LTC coverage.2 The growing popularity reflects strong market momentum and the potential to meet evolving consumer needs. While business volume continues to rise, insurers are navigating challenges around product complexity, distribution, technology, risk management and regulatory requirements, areas that also present opportunities for differentiation and growth.
This executive summary provides strategic insights from the LIMRA/EY US 2025 individual life combination LTC survey. Based on responses from 35 insurance companies and nine executive interviews, the report highlights market dynamics, business strategies, distribution landscape, risk management, technology and operational imperatives shaping the future of combination long-term care insurance. This survey was jointly administered by LIMRA and Ernst & Young LLP (EY US) and is a follow-up to the first LIMRA/EY US 2018 individual life combination LTC survey and its report titled, Combination Products: A One-Stop Solution?
Download the individual life combination LTC report to view the full findings.
Download the supplemental workplace life combination LTC report.
Key findings
Market dynamics and consumer demand
Consumer demand for LTC protection remains robust, with 63% of individuals expressing a need for LTC-focused insurance. This demand has accelerated the shift from traditional standalone LTC insurance products to hybrid life combination LTC offerings. These products deliver dual value — financial protection and flexibility — resonating strongly with younger generations and caregivers of those with LTC needs.
Business strategy insights
Insurers are executing targeted strategies to meet market needs and diversify portfolios. Chronic illness (CI) riders are integrated into broader life insurance portfolios, while LTC riders and linked benefit products require specialized sales strategies. Strategic levers include competitive product design, expanded distribution, pricing optimization and brand differentiation.
Market segmentation and product innovations
The market continues to focus on mass affluent consumers ages 45–64 with household incomes above $100,000. However, younger consumers are also showing strong interest, and the middle-income segment remains underpenetrated. Longer premium structures and workplace-distributed products are emerging as viable strategies to unlock this segment. Indexed universal life insurance (IUL) remains the preferred chassis, while variable universal life (VUL) is gaining traction among high-net-worth individuals.
Distribution and consumer engagement
Distribution remains anchored in independent agents, affiliated agents and broker-dealers. Newer carriers rely on LTC-savvy distributors, while experienced players deepen existing relationships. Marketing efforts are distributor-centric, but carriers recognize the importance of educating consumers, and caregivers who understand the value of LTC planning.
Underwriting
Underwriting protocols have matured significantly since the previous survey. Over 60% of carriers now utilize six or more data inputs, including pharmacy checks, cognitive assessments and analytics. These expanded protocols reflect a more sophisticated approach to managing morbidity risk and pricing accuracy.
Despite these advancements, gaps remain. Many carriers lack in-house morbidity underwriting expertise and rely on external vendors or simplified approaches. The industry continues to explore emerging technologies such as artificial intelligence (AI), biomarker testing and digital cognitive tools to enhance risk prediction and streamline processes. Balancing speed-to-issue with thorough risk assessment remains a priority for strategic planning.
Technology
Technology investment is critical to operational efficiency and scalability. Legacy systems pose challenges for administering living benefits, prompting carriers to prioritize front- and middle-office integration. While AI is still in early exploration, it is expected to play a growing role in underwriting, claims automation and customer engagement.
Carriers are taking varied approaches to address infrastructure limitations, including building proprietary systems, purchasing third-party solutions and outsourcing. Claims processing remains largely manual, highlighting the need for scalable infrastructure and automation to support future growth and innovation.
Product development and operation challenges
Combination LTC products are more complex and time-intensive to develop than traditional life insurance. Bottlenecks include design, product filing and system updates. A shift toward in-house expertise is underway, driven by the need for better risk management and faster development cycles. However, limitations in technology and modeling continue to hinder progress; therefore, strategic investment in these areas is essential to support innovation, streamline processes and enable scalable growth.
Outlook
Looking ahead, carriers expect that product innovation will be a key differentiator. Policies with longer premium structures and workplace products show promise for expanding access. Legislative developments such as the Washington Cares Act and Well-Being Insurance for Seniors to be at Home Act (WISH Act) may reshape the market, and insurers are well-positioned to influence policy through advocacy and collaboration.
Key areas for strategic investments
- Prioritize product innovation to meet evolving consumer needs and expand market reach.
- Invest in scalable technology infrastructure to support underwriting, claims and policy administration.
- Strengthen in-house expertise in morbidity underwriting and actuarial modeling to accelerate product development.
- Explore partnerships with distributors with strong middle market connections and strengthen distributor relationships through platform integration, training and support.
- Enhance consumer education initiatives, particularly targeting caregivers and younger demographics.
- Engage proactively with policymakers to shape future LTC legislation and promote public-private collaboration.
Summary
In summary, the combination LTC market is poised for continued growth. By aligning strategic investments with evolving consumer needs and market dynamics, insurers can lead the transformation of long-term care solutions and deliver sustained value to stakeholders.
How EY can help
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Navigate the evolving life insurance and retirement landscape with our team. Transform challenges into growth opportunities for long-term success.
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Our finance and actuarial transformation team can help your insurance business transform the finance function into a valued business partner. Learn more.
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EY insurance professionals can help transform your end-to-end underwriting capabilities to optimize performance. Learn more.
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