Rate request: 22.5 overall average percent increase
Decision: Disapproved as submitted, approved 19% increase on January 5, 2015
On September 19, 2014, Genworth Life Insurance requested an average increase of 22.5 percent on three of its policies (7030, 7032, 7033). These individual policies were sold from 1998 to 2003 and are no longer being marketed. There are approximately 4,700 policies in force in Connecticut.
When broken out, the range of the requested increases are 32 percent on policies with a lifetime benefit, and 19 percent on policies with all other benefit periods.
The company reported it needed to raise rates because the number of people drawing lifetime benefits is significantly higher than what was initially anticipated when the company first priced the product. The costs to maintain those benefits for the lifetime of the plan are also higher than anticipated.
After an actuarial review, the Department determined that this particular block of business was performing much worse than expected and that some rate increase was warranted. However, the Department noted that the company did not entirely account for a previously approved increase in 2013 in its calculation. As a result, the Department disapproved the request as submitted but did approve a lower increase of 19 percent on Jan. 5, 2015.
The company will offer its customers several options to change benefits and keep premium costs down near current levels to mitigate the impact to its policyholders.