Another Major LTC Player Making Sweeping Changes

[bluemarlin08]

Looks like Genworth is making some big changes effective July 31.

 

[Crabcake Johnny]

 

[Arthur Rudnick]

And, what might those changes be?

 

[bluemarlin08]

Received a phone call from a career GE agent, what I recall;

Marital discount reduced from 40% to 20%
No more 10 pay

Can't recall the rest of the changes but I asked him to send me an email detailing the changes.

 

[Mr_Ed]

And, what might those changes be?

big ones.

 

[bluemarlin08]

Rather than ask the states for rate increases, changing benefits can produce the same results. Actuaries never anticipated interest rates to be so low and with little relief in sight.

 

[yankee466]

My unofficial source says:

Our understanding of the changes are as follows:
· Changes are for PC Flex product only (Privileged Choice Flex).
· Some of the changes are subject to state approvals and will be rolled out as approved. Some changes are not subject to state approval and will be effective on the date provided.
· The changes will be made effective with applications written after July 30th (subject to state approvals, etc.)
· Eliminating the lifetime maximum benefit.
· Eliminating limited payment options (e.g., 10-pay).
· Eliminating the preferred health discount (so all policies will be issued at Standard or rated).
· Marital discounts (40/25) are being reduced to 20/10 (this one required filing so it won’t apply to all states immediately).
· Reducing first-year broker comp by 15%. They will be doing this across the board on all broker compensation plans for PC Flex.
· Tightening UW guidelines (more detail to follow):
o Will decline anyone with history of schizophrenia
o Will decline anyone with SS disability claim within last 5 years
o Will require family medical history on application to be completed (right now it’s optional). They say they won’t use this to make an UW decision however they may request additional information based on the answers (applications where this is not completed will be returned).

 

[Arthur Rudnick]

Reducing first-year broker comp by 15%. They will be doing this across the board on all broker compensation plans for PC Flex.

Nice, so instead of raising premiums, they're taking it out of the agent's pocket.

It may be a sign of things to come.

 

[billberry12]

Seems to me Genworth is sending a very clear message, similar to the message JH sent a while back.

DON'T SELL OUR PRODUCT!

OK already, I get it Genworth!!

 

[Mr_Ed]

Reducing first-year broker comp by 15%. They will be doing this across the board on all broker compensation plans for PC Flex.

Nice, so instead of raising premiums, they're taking it out of the agent's pocket.

It may be a sign of things to come.

it's only temporary.