LTC insurance premiums to rise as cost of care accelerates
Many long-term care insurance policy holders in Connecticut just saw their premiums jump by double digits, a trend that is likely to continue.
Karen Eldred, a spokeswoman for the MetLife Insurance Company, told McKnight's that Connecticut is not unique, as rate actions have been filed in several other states. She says data for these policies indicates that a premium rate increase is justified.
Connecticut regulators told the Hartford Courant that they had refused to enact two-thirds of all the premium increase requests since 2007. But recently MetLife of Connecticut was allowed to impose a 39% increase on policyholders, starting this summer, the paper reported. That makes the firm the latest long-term care insurance company with double-digit rate hikes in the state over the past 18 months. The primary reason for the increases are recent cost shifts and Medicaid's inability to cover the full cost of care, according to the newspaper.
The rates MetLife requested are based on what it believes will be higher-than-expected claims down the road, Eldred said.”LTCI is a relatively new product that covers a risk 20 to 50 years in the future,” Eldred told McKnight's. “Actuarial assumptions continue to evolve as experience emerges. Carriers continually evaluate assumptions to ensure pricing remains appropriate. These actions are necessary to ensure that we deliver on our promises to all of our policyholders.”