CID: Long-Term Care Rate Filing - Transamerica Premier Life Insurance Company (Individual)

Long-Term Care Rate Filing - Transamerica Premier Life Insurance Company (Individual)

Rate request: 65 percent increase

Decision: Disapproved, limited to a 30% increase on September 5, 2017

On May 4, 2017, the Transamerica Premier Life Insurance Company filed for a 65 percent rate increase on a small block of its individual long-term care policies. There are approximately 120 policies currently in force in Connecticut. The company is no longer marketing this product.

The company said it needs the increase because actual claims costs far exceeded projected costs that were calculated when the product was originally priced.

Unlike medical health insurance with premiums set to cover expenses incurred only during the upcoming policy year, long term care premiums are set to cover expenses that are not expected to occur until a distant date, sometimes 20 years in the future.

After an actuarial review, the Department determined that this block of business in Connecticut is performing worse than expected but is still below the statutory minimum loss ratio of 60 percent. In other words, the company must spend 60 cents of every premium dollar on benefits over the life of the policies and has not yet met that threshold. As a result, the Department disapproved the requested increase on September 5, 2017 but did allow an increase of 30 percent. Under Connecticut law, long-term care rate increases of 20 percent or higher must be phased in over three years or more.

The company said policyholders will be given the option to offset the increase and lower their premium by reducing their current benefits.


Find the filing documents here at Long-Term Care Insurance Rate Filing

Content Last Modified on 9/6/2017 10:56:16 AM