Hancock Announces New Rate Increases

Nov 14, 2016

  1. Arthur Rudnick
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    Arthur Rudnick Moderator Moderator

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    It was just announced that John Hancock is filing for an average rate increase of 20% on the majority of their LTC policy series.
     
  2. ltcadviser
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    ltcadviser Guru

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    Of course they are......
     
  3. CALTCAgent
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    CALTCAgent Guru

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    So are these new rate increases on policies not protected from the new premium increase regulations ?
     
  4. Arthur Rudnick
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    Arthur Rudnick Moderator Moderator

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    originally posted by CALTCAgent

    And, what non-existent regulations are those?

    Looks like policy series from 2006-2015
     
  5. CALTCAgent
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    There have been some old threads about these regulations. I can't find them right now. They mentioned that the new regulations were in place and that took the profit out of rate increases, etc.


    Interesting. Very recent policies then.
     
  6. Arthur Rudnick
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    Arthur Rudnick Moderator Moderator

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    originally posted by CALTCAgent

    The regs, (IMO) are either bogus or non-existent. It's supposed to be part of The Model Act and limits rate increases to rare exceptions.

    Let's see:
    Hancock just announced a rate increase on most of their policies series up to 2015, today MOO announced rate increases in about 10 states and Genworth's new plan of attack is to request a 10% rate increase every year.

    This is not a "profit" issue. It's due to lower Reserves that are mandated by the states.

    I guess no one read the regs.

    However, I'm sure I'll quickly be corrected in my assumption.......
     
  7. Mr_Ed
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    Mr_Ed Guru

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    where did you read that genworth wants a 10% increase every year?
     
    Mr_Ed, Nov 17, 2016
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  8. Arthur Rudnick
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    Arthur Rudnick Moderator Moderator

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    Originally posted by Mr_Ed

    Thomas Mcinerney has been on record a number of times stating that.

    He says that rather than ask for 20%-30% increases every few years, he wants to raise rates every year.

    Look it up...............
     
  9. ltcadviser
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    ltcadviser Guru

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    My recollection is McInerney did not state Genworth WILL request rate increases every year. What I believe occurred is he was having a conversation and he stated his thoughts that he felt he preferred a business model where there would be more frequent but much smaller rate increases, rather than a business model where insurance companies would need to get a huge rate increase of 60% for instance.
     
  10. Arthur Rudnick
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    Arthur Rudnick Moderator Moderator

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    originally posted by ltcadviser

    OK, that sounds about right.
    But how could he be stating that he would prefer for future products be allowed to have an annual rate increase every year, when someone here has previously posted that future increases, due to the Model Act would prohibit that?

    I have him quoted as saying:
    "The company is looking for smaller, more frequent rate hikes on new policies, a shift from the current model where policyholders may go years without an increase, but then face the shock of a double digit increase"


    Here's a novel approach:
    They've been in business for 40 years. How about figuring out how to finally price their products correctly?

    I that asking too much?
     
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