Rate request: 182 percent average increase
Decision: Disapproved as submitted, approved 15% increase on January 6, 2015
On October 8, 2014, Time Insurance Company requested an average increase of 182 percent increase on certain individual long-term care insurance policies. The policies were initially offered in 1997 and are no longer being actively marketed.
There are approximately 200 policies in force in Connecticut.
The company said it sought the increase because the number of people expected to draw lifetime benefits on a nationwide basis is significantly higher than what was initially anticipated when the company first priced the product. The company also factored in the increase in the cost of benefits since the product had originally been priced and said the cost to maintain those benefits for the lifetime of the plan is higher than anticipated.
After an actuarial review, the Department determined that this particular block of business was performing worse than expected and that a rate increase was warranted. However, the Department also noted that the company failed to entirely take into account the effects of two previous rate increases.
As a result, the Department disapproved the initial increase request of 182 percent and instead approved a significantly lower rate increase of 15 percent on Jan. 6, 2015.
Time insurance said it will work with its customers to make benefit and other changes to mitigate the impact of any premium increase.