Another Major LTC Player Making Sweeping Changes

[ltcadviser]

50% higher? When I shared that Genworth was going to increase rates on May 3rd by 20 or 30 per cent as per my agent some folks did not believe me. Maybe I will get a little more R-E-S-P-E-C-T in the future. :-) I don't know a lot about this industry, but I try to share what little I know.

All I know is that I am glad I have my policy now. I don't think I can afford today's new rates.

Genworth is not "raising rates"; it is reducing the marital discount from 40% to 20 % and eliminating the Preferred health discount. For a single applicant in Standard health it's rate is still the same. For a healthy married individual, the net effect is the rate will be 60% higher.

Example $6000 premium with 20% marital discount results in $4800 premium.

Today it would be as low as $3000 if both partners are Preferred. $3300 if one partner is Preferred.

 

[Chuckles21]

50% higher? When I shared that Genworth was going to increase rates on May 3rd by 20 or 30 per cent as per my agent some folks did not believe me. Maybe I will get a little more R-E-S-P-E-C-T in the future. :-) I don't know a lot about this industry, but I try to share what little I know.

All I know is that I am glad I have my policy now. I don't think I can afford today's new rates.

So.... cutting discounts/benefits and lowering your commissions. Man, when I'm wrong i guess I'm wrong. Here I thought Genworth was crazy for their pricing structure and didn't see how it was plausible for them to continue as they were... but you all were correct in calling me stupid for such a crazy assessment. I mean they have 60% of the market and have to be just killing it... unless they didn't price correctly in the first place? Either way, I have learned a valuable lesson in that you guys are way smarter than me about this stuff.

 

[Justin Bilyj]

Whats up with genworth!?? First you cannot submit.paper apps below a certain amount now they are cutting comp amd.boosting prices. I'm beginning to think they are fast becoming.unfriendly..

 

[2insureyou]

So.... cutting discounts/benefits and lowering your commissions. Man, when I'm wrong i guess I'm wrong. Here I thought Genworth was crazy for their pricing structure and didn't see how it was plausible for them to continue as they were... but you all were correct in calling me stupid for such a crazy assessment. I mean they have 60% of the market and have to be just killing it... unless they didn't price correctly in the first place? Either way, I have learned a valuable lesson in that you guys are way smarter than me about this stuff.

My sentiments... EXACTLY!
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By the way bluemarlin08... I like the thread title

 

[Arthur Rudnick]

In taking a neutral position, what Genworth is doing should not be a big surprise.

There are only a few major players left and most (with some exceptions) are competitively priced, for basically the same product.

However over the years, history tells us that there always seems to be one company "under-priced".

Every 3-4 years carriers pull their products off the market and replaces them with the same policies, but with a few minor changes. That gives them the opportunity to raise their rates on new products. Everytime that happens, there's usually a 15%-30% rate increase. Over the past 8 years, some companies have done that more than once.

I recall Unum, (who had the only cash-benefit policy on the market at the time) they always seemed to charge less than most reimbursement policies. Over the previous 3-4 years, Unum never had a rate increase but other carriers did. That led me to believe that for the product they were offering, (which was better than any other policy) they appeared to be "under-priced" and I felt the actuaries were probably headed back to the table to discuss a new policy at higher rates.

One of the few good moves that I've done was to buy a Unum, cash-benefit policy for my wife and myself. And what do you know? A few months later, Unum requested a 30% increase in every state.

The funny thing is, (thank you NYS DOI) NY refused the entire rate increase!

So, I'm sitting with a policy that I bought about 8 years ago and it's priced so low, it's an embarrassment to tell people my benefits and premium.

Genworth determined that it was time to look for a rate increase. Thankfully, it's also not on existing policyholders, we've already seen enough of that.

I guess they took the middle grounds (like others have recently) and reduced comp, limited benefits: no more lifetime benefit, no more Preferred Health rate, no 10-pay (although I don't see the downside for a company getting a lot higher premium in a much shorter period of time) and they also reduced their partner discount.

And, don't forget they tightened up on their underwriting.
That's also a big thing.

Personally, I think what Genworth is doing is a smart move.

I'm not sure if this is something we'll start to see more often, but Genworth has some pretty smart people running the company and I would guess they have a pretty good view of the LTC landscape. Other carriers see it as well.

It's going to be an interesting next few years in the industry.

 

[Mr_Ed]

Bottom line:

Everyone on this forum should stop selling long-term care insurance.

Be sure to forward all your long-term care insurance leads/inquiries to me.


mred

 

[Arthur Rudnick]

Bottom line:
Everyone on this forum should stop selling long-term care
insurance. Be sure to forward all your long-term care insurance
leads/inquiries to me.

you take Jersey and I'll take NY..............

 

[ltcadviser]

Repricing has been happening for 9 years

 

[Arthur Rudnick]

originally posted by ltcadvisor

Repricing has been happening for 9 years

Sorry, I was off a year.........

I said:
"Over the past 8 years, some companies have done that more than once".

 

[ltcadviser]

originally posted by ltcadvisor



Sorry, I was off a year.........

I said:
"Over the past 8 years, some companies have done that more than once".

Well, you are probably closer to being correct.

Anyway let the bashing of Transamerica begin.

Egads! 0 day wait and a cash alternative benefit and they're priced 10% lower than its nearest competitor!? How are they doing it?????

NWML agent: " Well I know Transamerica is priced 35% lower than our quiet company, you don't need a 0 day wait and we have a hundred dollar dividend for you if you would like to pay 2000 more. Besides, a 100 billion dollar A+ company is hardly safe"