John Hancock Long Term Care is a Scam!

[scagnt83]

I think John Hancock is unprofessional if not a complete scam. I have a LTC contract with through my employer for a long time, close to ten years. However when I retired at the end of last year, John Hancock hiked my premium by more than 50%! If I do not agree with their new premium, all my previous payments would be wasted as my policy will be terminated. I think they deliberately use premium hike to drive off customers and pack the accumulated premium for themselves as pure profit. This make their LTC look like a scam.

Your employer was most likely paying 50% of your LTCI policy as an employee benefit; especially if you received the notice immediately upon retirement. Now that you are no longer an employee, you no longer receive the subsidy from your company.

The only way they can raise your premiums is if they did it to all policies of that type. Ask your old co-workers if their rates increased 50%.

 

[Arthur Rudnick]

OK, let me try this again............

As you know, I'm very passionate regarding the industry and when I read of someone accusing the product of being a scam, I get a little bent out of joint. So, I apologize for my initial reaction.

If you review my previous posts on other threads, I came down pretty hard on Hancock (as many posters did) regarding their announced rate increases last year. It was not only their rate increases on existing policyholders, but also announced increases going forward.

I also have Hancock policyholders that have been hit with 50% rate increases and I try and deal with them as best as I can. Obviously, not a pleasant conversation.

So, I am in no way trying to excuse their behavior.

In Hotpeppers situation, his alternative of dropping from a 5-year benefit period to 2-years or lowering the daily benefit from $160 to $105 is an insult to him and a travesty for the industry.

They have made their decision and they'll have to live with the ramifications.

 

[Norwayguy]

This is a somewhat flawed analogy.

With P&C coverage, when the rates go up the vast majority of people in their 60s and 70s have alternatives. (When AAA raised my HO to $1000 I found an agent who was able to write me with Travelers... same policy, half the premium.)

Even with health insurance there are alternatives (i.e. PCIP) and in a couple of years there will be more alternatives.

With LTC where is someone to go? The answer is they pay the increased premium or walk away losing their "investment" or they take a big cut in benefits for what they are currently paying... which is also a loss.

Is LTC a scam? I understand why the poster in this thread believes so. He's not the only one. There is only a 7% penetration in the market, and it is obvious that a lot of people are not seeing the value in the products being sold today, or they are not willing to take the "investment" risks associated with them.

You can argue the merits or demerits of LTC all day long but bottom line LTC is seen by most of the customer base as a flawed product and LTC has, by and large, been rejected by the free market.

Al3 you have some valid points and I think as LTC is around longer (its a new product when you think how long life di etc have been around) We will someday see mandated nonforfieture options.... Compare LTC to whole life when originally sold whole life had no access to cash values and was just a policy that paid a death benefit as long as premium was paid... Then eventually we got the standard nonforfieture options of CSV, Extended term and reduced paid up.

 

[scagnt83]

TL,

You admit that she has only been eligible for a week.

Common sense would dictate that it will take longer than a week, and they will need paperwork verifying her condition.

And if you have been in the insurance world for more than two days you will have dealt with plenty of idiotic service center people. But that doesnt mean the policy is a scam, it means your dealing with one individual ***.

Act like an adult, and even more importantly, act like a professional.


NDM, Aurthor, and others could really help guide you through this situation and get things taken care of if you just asked the right questions.

I would probably get back to NDM on that face to face care advisor.....

 

[tlmarketing]

OK, let me try this again............

As you know, I'm very passionate regarding the industry and when I read of someone accusing the product of being a scam, I get a little bent out of joint. So, I apologize for my initial reaction.

If you review my previous posts on other threads, I came down pretty hard on Hancock (as many posters did) regarding their announced rate increases last year. It was not only their rate increases on existing policyholders, but also announced increases going forward that in spite of what Hancock claims, has basically put them out of the business. Simple put, they are the highest priced major LTC carrier in the market with a product which is inferior to their competition.

I also have Hancock policyholders that have been hit with 50% rate increases and I try and deal with them as best as I can. Obviously, not a pleasant conversation.

So, I am in no way trying to excuse their behavior. They will go from the #2 seller of the product in 2010 to off the charts in 2012.

In Hotpeppers situation, his alternative of dropping from a 5-year benefit period to 2-years or lowering the daily benefit from $160 to $105 is an insult to him and a travesty for the industry.

They have made their decision and they'll have to live with the ramifications.

Just as a follow-up and to put this one to rest, the promises made by JH as to how they would handle the claims request the second time around was complete bs....

It was like reinventing the wheel, and that was not how it was supposed to be according to claims manager we dealt with first time around.....

so.....we started the whole process again....the intake process, to scheduling the nurse to come out an make the evaluation, there were a couple of family members there for the most recent evaluation, trying to establish when the 90 day elimination clock started ticking, etc, etc...

they are "expediting" the process now to make a decision if insured qualifies....waiting.

 

[hotpepper]

Your employer was most likely paying 50% of your LTCI policy as an employee benefit; especially if you received the notice immediately upon retirement. Now that you are no longer an employee, you no longer receive the subsidy from your company.

The only way they can raise your premiums is if they did it to all policies of that type. Ask your old co-workers if their rates increased 50%.

My employer insisted the LTC with JH received no company "matching" but a group rate cover all employees/retirees at this very large company (one of the largest manufacturing companies in the country). Also no premium increase for the active employees I have checked so far. I will check in a week or so as I just received my premium hike last Thursday.

I felt like a "fool" as I signed up to this LTC in early 2000s. Many of my co-workers were against it. Many years of "investment" wasted. JH may hike the premium or reduce coverage again soon, who knows.

BTW, JH used to handle dental coverage for my employer, however, years of poor customer support and high premium made my old employer droped them, switch to another company.
- - - - - - - - - - - - - - - - - -

Your employer was most likely paying 50% of your LTCI policy as an employee benefit; especially if you received the notice immediately upon retirement. Now that you are no longer an employee, you no longer receive the subsidy from your company.

The only way they can raise your premiums is if they did it to all policies of that type. Ask your old co-workers if their rates increased 50%.

My employer insisted the LTC with JH received no company "matching" but a group rate cover all employees/retirees at this very large company (one of the largest manufacturing companies in the country). Also no premium increase for the active employees I have checked so far. I will check in a week or so as I just received my premium hike last Thursday.

I felt like a "fool" as I signed up to this LTC in early 2000s. Many of my co-workers were against it. Many years of "investment" wasted. JH may hike the premium or reduce coverage again soon, who knows.

BTW, JH used to handle dental coverage for my employer, however, years of poor customer support and high premium made my old employer droped them, switch to another company.

 

[2insureyou]

This is a somewhat flawed analogy.

With P&C coverage, when the rates go up the vast majority of people in their 60s and 70s have alternatives. (When AAA raised my HO to $1000 I found an agent who was able to write me with Travelers... same policy, half the premium.)

Even with health insurance there are alternatives (i.e. PCIP) and in a couple of years there will be more alternatives.

With LTC where is someone to go? The answer is they pay the increased premium or walk away losing their "investment" or they take a big cut in benefits for what they are currently paying... which is also a loss.

Is LTC a scam? I understand why the poster in this thread believes so. He's not the only one. There is only a 7% penetration in the market, and it is obvious that a lot of people are not seeing the value in the products being sold today, or they are not willing to take the "investment" risks associated with them.

You can argue the merits or demerits of LTC all day long but bottom line LTC is seen by most of the customer base as a flawed product and LTC has, by and large, been rejected by the free market.

Indeed a flawed analogy... the major reason is underwriting. Life, disability, and ltc are often "irreplaceable" due to underwriting because of changes in health and age.

The industry needs much work, and much more conservative assumptions on underwriting, interest rates, claims expectations, etc... There are only a few companies not dealing with these kinds of issues right now, (although, who knows about the future), and they all started with MUCH more conservative assumptions on all three points.

However, I don't know if even those companies were conservative enough, considering how long we've been in a low interest rate environment... we have certainly seen one of them deal with it through increasing rates on future policies, though not in-force.

When this kind of thing happens year after year, it is bad for the industry. My company may be one of those few who is winning on financial strength and being conservative in initial assumptions... we like to win, don't get me wrong, but when competitors suffer as much as they have, it's bad for us too.

NML gives us the right to "sell away", and I have on LTC in the past, because the client didn't want to pay the higher premium. Nowadays, I'm much more adamant about implementing NML as a solution, because there is nothing worse than having to come back and ask for more money.

I really hope these other big companies get it together, because it will be better for everyone if they do.

 

[Mr_Ed]

...I'm much more adamant about implementing NML as a solution, because there is nothing worse than having to come back and ask for more money....

It's OK to ask for 50% more premium to begin with.... but there's nothing worse than asking for more later on?

That doesn't make any sense.

I'd much rather have a client pay 30% to 70% less NOW and risk a potential premium increase 10 to 20 years from now, than having them pay substantially more now and forever.





What's really so funny about this whole discussion is how illogical everyone is about it.

We conclude that LTCi doesn't work because the premiums can increase. The premiums have gone up because they've been paying a lot more claims than they ever expected to pay.

Hence, LTCi DOES work. It especially works for the claimants.

... and for those of you who aren't aware, it works for the insurers. Nearly every LTC insurer is making a ton of money on it. Of course they make more money on life insurance and other products. But don't kid yourselves. They are raking in the dough on LTCi also.

 

[hotpepper]

It's OK to ask for 50% more premium to begin with.... but there's nothing worse than asking for more later on?

That doesn't make any sense.

I'd much rather have a client pay 30% to 70% less NOW and risk a potential premium increase 10 to 20 years from now, than having them pay substantially more now and forever.

What's really so funny about this whole discussion is how illogical everyone is about it.

We conclude that LTCi doesn't work because the premiums can increase. The premiums have gone up because they've been paying a lot more claims than they ever expected to pay.

Hence, LTCi DOES work. It especially works for the claimants.

... and for those of you who aren't aware, it works for the insurers. Nearly every LTC insurer is making a ton of money on it. Of course they make more money on life insurance and other products. But don't kid yourselves. They are raking in the dough on LTCi also.

This is the reason JH and other LTCi sellers are scammers, not paying the claims but keep the premium for themselved as pure profit while keep increasing the rates. This is a wonderful business for them.

 

[Arthur Rudnick]

This is the reason JH and other LTCi sellers are scammers, not paying the claims but keep the premium for themselved as pure profit while keep increasing the rates. This is a wonderful business for them.

Possibly you'd like to say that to the dozens of my LTC policyholders who are on claim and receiving benefits in a timely manner?