Rate request: 85.6 percent average increase
Decision: Disapproved on March 30, 2016; limited to 40% over 3 years
On December 30, 2015 Genworth Life Insurance requested an average rate increase of 85.6 percent on a series of individual long-term care policies that were sold in Connecticut from 1998 to 2003. They are no longer being marketed.
There approximately 4,500 policies in force in Connecticut.
The company said the rate increase is needed because the benefit costs far exceed what the company had originally projected when it originally priced these products. Genworth says it has been paying benefit costs longer than expected and there are more policies in effect that what the company had anticipated.
The company said it will offer its customers several options to change benefits and keep premium costs.
After an actuarial review, the Department determined that this block of business is performing much worse than expected but noted that the company had not accounted for the impact of past rate increases in this current filing. As a result, the Department disapproved the initial rate increase and instead approved a lower increase of 40 percent on March 30, 2016.
Under Connecticut law, increases of 20 percent or more must be spread out over a minimum of three years to mitigate the impact for policyholders.