chapter 9 page 9

[rajashri]

under the heading
Selling characteristics of different products

for all the other products such as CI,PMI and IP there is clear mention where the product will be sold /bought .

but under LTCI there is no mention of whether the product can be bought /sold .

ans: usually LTCI products are bought rather than sold because it depends on the financial requirement,condition ,security purpose of the prospective buyer .So its usually that ,its bought rather than sold.

is the answer right or any further reasoning ?

 

[Steve McIntosh]

Is LTCI bought or sold

I'm not so sure. I think the "answer" is "it depends"!

The Core Reading points out this very much depends on "the perceived attitude to governments to the provision of care and individuals' priorities on long-term funding for this purpose."

In territories where the purchase of LTCI is compulsory it may be generally bought.

However, in the UK, for example, consumer demand for LTCI products is generally low. Reasons for this include uncertainty regarding what level of care the state with provide people when thay get old age (but it will probably provide something!), relatively high premiums (insurers need high margins to allow for uncertainty, e.g. in claim experience) and other protection products taking priority (e.g. CI and IP provide protection cover now, whereas LTCI is unlikely to pay out till you're very old - if at all). In this environment, I'd say that LTCI usually has to be sold.

Hope this helps.