Last Year, 807,000 Long-Term Care Insurance Beneficiaries... "Conditions in the Care Market Must Improve"

'Current Status of Elderly Long-Term Care Services and Challenges for the Insurance Industry' CEO Report

[Asia Economy Reporter Ki Ha-young] As the long-term care market is expected to expand in the future, advice has been given that insurance companies should actively participate in the long-term care business itself and respond proactively. Additionally, it has been pointed out that policy supplementation is necessary to improve the market environment.

According to the CEO report "Current Status of Elderly Long-Term Care Services and Challenges for the Insurance Industry" released by the Korea Insurance Research Institute on the 20th, the number of long-term care insurance beneficiaries last year was 807,000, accounting for 9.5% of the elderly population. The beneficiary growth rate increased from 8.5% in 2014 to 10.2% last year, which is a steeper rise compared to the elderly population growth rate during the same period (4.4% → 5.8%), indicating an expected expansion of the long-term care market.

Currently, a significant portion of long-term care service recipients are in blind spots, but expansion of the public sector is limited due to financial issues. Among non-beneficiaries, 34.7% are in blind spots where they neither receive long-term care services nor assistance from cohabiting or non-cohabiting family members. Beneficiaries mainly use home care services (especially cohabiting home care services) rather than facility services. Care costs are primarily borne by children (69.4%), and 81.5% reported feeling an economic burden due to care expenses.

Accordingly, in a survey related to the insurance industry's participation in the long-term care business, most respondents showed a positive response to insurance companies participating in the long-term care business. Since insurance companies' care insurance can be used as a resource for long-term care services, 71.1% of respondents viewed insurance companies' participation in the long-term care business more positively compared to other industries, and 69% expressed willingness to use long-term care services provided by insurance companies.

The report advised that, given the expected expansion of the long-term care market, insurance companies should proactively respond to the future of the market through investments in the potential market formation of the long-term care industry. It emphasized the need for more active consideration not only in improving existing care insurance and developing new products such as corporate parent care insurance but also in directly participating in the long-term care business itself.

Furthermore, it suggested that policy supplementation is required to improve the market environment because providing high-quality long-term care services is difficult due to realistic constraints on both demand and supply sides. Senior Research Fellow Kang Sung-ho of the Korea Insurance Research Institute said, "On the demand side, reliance on family support prevents the normal expression of long-term care service demand, and on the supply side, there are constraints such as high initial investment costs and management risk burdens. To revitalize the long-term care market and provide high-quality long-term care services, policies are needed to accurately estimate long-term care demand and reduce market uncertainties to ensure smooth supply of long-term care services."

This content was produced with the assistance of AI translation services.