CoventryOne 26% Premium Increase for 2010

[Bitnis]

I don't know about company wide but my rates here in NC are going up 26% for next year. I have no choice but to leave one of my children on there due to a blood condition. The rest of us will be bugging out. Goodbye Wellpath.

That number seems high enough to justify thinking that they are going out of business? Or are all the health insurance companies going to gouge people before the government puts them out of business?

 

[somarco]

Coventry has been red hot in GA since they debuted almost 3 years ago. Hot rates, rich benefits and schizophrenic underwriting.

They look damn good on a spreadsheet but beyond that I wouldn't give you $0.10 for them.

I understand from someone who follows them they are having LR problems in several states. Supposedly GA is OK but I don't see how.

January rates from other carriers aren't running that high, more moderate.

I don't see how regional carriers can survive.

 

[Bitnis]

26% is clearly an unsustainable number.

 

[somarco]

Blue gives those kind of increases all the time on renewal but keep churning along. Other carriers can't play on their reputation and get away with it.

FWIW, even with Coventry's low rates they can give out 20 - 30% increases and still be competitive most of the time. Back when Blue was buying business they would smoke everyone on first year quotes, come back with a 40% renewal. Policyholders would scream and go shopping only to find no one was within 20% of the Blue renewal.

Next year another 25% and another shopping round with the same result. By the time the 3rd renewal came around folks never bothered to shop figuring they wouldn't find anything better.

 

[JosephDeacon]

I work primarily in WV, and they came into the market in 2007. They have been competitive since then and renewals have been somewhere in the 12-20% range.

Somehow, they lowered new business rates for 2010 here.

 

[alphawave2k]

I don't know about company wide but my rates here in NC are going up 26% for next year. I have no choice but to leave one of my children on there due to a blood condition. The rest of us will be bugging out.

It's surprising to hear of rate increases for the upcoming year this early from Coventry. I recently got appointed with Coventry of GA, and during their broker orientation meeting they claimed that they have had a strategy in place of lagging competitors' announcements for new rates until February...I thought that was the month they would announce? That way they can see their competitors' rates and adjust accordingly to remain competitive. Most carriers announce new rates by the end of the year, unless your policy anniversary precedes that date in which case you get the upcoming rates, I suppose. Their marketers made a point of demonstrating the ability to submit an app at today rates (a couple of weeks back now), with a policy effective date of Jan1.
Maybe they've changed that already, or every state does it differently.

 

[somarco]

That way they can see their competitors' rates and adjust accordingly to remain competitive.

If that's true, that is an incredibly stupid business model. I don't know, nor do I care, what they are doing now. They used to release rates every quarter.

They recently took a different underwriting stance and will now offer riders in addition to rate up.

 

[Bitnis]

A friend just told me her BCBS rates are going up 17%.

 

[somarco]

Bitnis, how long have you been writing major med?

 

[alphawave2k]

If that's true, that is an incredibly stupid business model. I don't know, nor do I care, what they are doing now. They used to release rates every quarter.

Maybe they still do...it just so happened that I attended the orientation during the last quarter...I think the point that might have gotten lost on me is that their "fiscal" runs from Feb-Feb? or some other month rather than calendar, and therefore the upcoming quarter's rate increase won't be announced at the start of the calendar..

They recently took a different underwriting stance and will now offer riders in addition to rate up.

I just had someone turned down, and still wondering what happened during the interview? The worse that I thought might have happened was a rate up or rider, but no counter was offered.
Not sure how much business I'll be writing for these guys, but I have a local bud who absolutely loves them on the group side.