How much risk is mitigated by LTC Insurance? A case study of the public system in Spain

Identifier:  PC:2408

Handle: https://hdl.handle.net/20.500.11797/PC2408

Authors:  Comas-Herrera, Adelina; Guillén, Montserrat

Abstract:
We present a methodology that allows to calculate the impact of a given Long-Term Care (LTC) insurance protection system on the risk of incurring extremely large individual lifetime costs. Our proposed methodology is illustrated with a case study. According to our risk measure, the current Spanish public LTC system mitigates individual risk by more than 30% compared to the situation where no public protection were available. We show that our method can be used to compare risk reduction of alternative LTC insurance plans.