Long-term care insurance premiums are rising again in Pennsylvania, by a lot. Here’s why.

[Northeast Agent]

Long-term care insurance premiums are rising again in Pennsylvania, by a lot. Here’s why.

About 100 companies nationwide sold stand-alone long-term care insurance in 2002, according to the National Association of Insurance Commissioners. Now, there are only 17, which includes 10 companies selling policies in Pennsylvania.

Genworth and other carriers are just now seeing the results of actuarial errors made years ago, said Richard Sabo, principal of Gibsonia-based RPS Financial Solutions.

“The industry has been imploding because they sold a ton of policies and they mispriced them,” Sabo said. “They have a financial mess.”

 

[Newby]

Long-term care insurance premiums are rising again in Pennsylvania, by a lot. Here’s why.

About 100 companies nationwide sold stand-alone long-term care insurance in 2002, according to the National Association of Insurance Commissioners. Now, there are only 17, which includes 10 companies selling policies in Pennsylvania.

Genworth and other carriers are just now seeing the results of actuarial errors made years ago, said Richard Sabo, principal of Gibsonia-based RPS Financial Solutions.

“The industry has been imploding because they sold a ton of policies and they mispriced them,” Sabo said. “They have a financial mess.”

That's been the story for years with a lot of companies. John Hancock was approved to have 90% rate increases in one year in certain states back 6 or 7 years ago.

Met Life was my big carrier and they pulled out several years ago for the same reason. But fortunately their rate increases haven't been real bad on the existing policies.

My answer to anyone calling me for LTC, is no. Life policies with LTC benefits are fine. Annuities with LTC benefits make sense. But stand alone LTC policies, not for me.

 

[Northeast Agent]

Agree with you.

Do you sell any of the STC policies?

 

[ltcadviser]

This exact same story has been spun and respun every 6 months since 2012. Surely editors can find new content at some point. This is not news.

 

[Mr_Ed]

Long-term care insurance premiums are rising again in Pennsylvania, by a lot. Here’s why.

About 100 companies nationwide sold stand-alone long-term care insurance in 2002, according to the National Association of Insurance Commissioners. Now, there are only 17, which includes 10 companies selling policies in Pennsylvania.

Genworth and other carriers are just now seeing the results of actuarial errors made years ago, said Richard Sabo, principal of Gibsonia-based RPS Financial Solutions.

“The industry has been imploding because they sold a ton of policies and they mispriced them,” Sabo said. “They have a financial mess.”

This rate increase applies to only a handful of the Genworth policyholders in Pennsylvania. Pennsylvania was slow to approve this increase. Most states approved this increase years ago.

 

[ltcadviser]

My answer to anyone calling me for LTC, is no. Life policies with LTC benefits are fine. Annuities with LTC benefits make sense. But stand alone LTC policies, not for me.

To each their own.

 

[Newby]

To each their own.

If it's your speciality that's a whole different thing. I'm talking about agents like me that sell life, Med Sups, annuities, etc. I no longer choose to help them with LTC and I only did in the past when they brought it up to me. I've never been a huge believer in stand alone LTC policies because I never trust insurance companies to hold down rates if they aren't legally required to. LTC is not something that people can re-shop if the rates go crazy after they have paid into it for 15 years.

But I would be happy to refer cases to a specialist if you can help them. I do still get people asking.

 

[ltcadviser]

There is no free lunch with the hybrid life or annuity policies with extension of LTC benefits riders; just as there is no free lunch with a traditional LTC policy. Traditional LTC policies are still more than capable and efficient solutions to address long term care costs.

 

[Mr_Ed]

If it's your speciality that's a whole different thing. I'm talking about agents like me that sell life, Med Sups, annuities, etc. I no longer choose to help them with LTC and I only did in the past when they brought it up to me. I've never been a huge believer in stand alone LTC policies because I never trust insurance companies to hold down rates if they aren't legally required to. LTC is not something that people can re-shop if the rates go crazy after they have paid into it for 15 years.

But I would be happy to refer cases to a specialist if you can help them. I do still get people asking.

Have you spent any time at all learning about the Rate Stability Regulation?

long term care insurance rate increases

 

[Newby]

Have you spent any time at all learning about the Rate Stability Regulation?

long term care insurance rate increases

No. Apparently my state Indiana hasn’t done that.