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

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

Rate request: 151 percent increase

Decision: Disapproved, limited to 30% increase spread out over 3 years

On August 7, 2015, the Transamerica Life Insurance Company filed for a 151 percent rate increase on several different types of its individual long-term care plan. There are approximately 6,260 policies currently in force in Connecticut that would be affected by this rate change.

The company stated it sought 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 particular block of business is performing worse than expected and some increase is warranted. However, the Department noted that the company has not yet met the minimum state threshold of spending at least 60 percent of premium dollars on benefits, a factor known as the medical loss ratio. As a result, the Department disapproved the initial increase request but approved an increase of 30 percent to be spread out over at least three years per state law.

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, brief summary and public comment section here at Long-Term Care Insurance Rate Filing

Content Last Modified on 2/17/2016 10:30:54 AM