Rate request - 58 percent increase
Decision - Disapproved March 1, 2013
On January 31, 2013, Metropolitan Life Insurance Company (MetLife) requested a 58 percent increase on three of its LTC97 policy forms, which were sold from 1999 to 2003. They are no longer being marketed. There are approximately 720 policies in force in Connecticut.
There have been no rate changes to date on this particular group of policies, which are guaranteed and renewable for life. The Insurance Department rejected an 18 percent rate increase request on these policies in 2010.
The company said in its filing that the increase is needed because over the life of these polices the expected demand for benefits and the higher cost of those benefits “far exceeded both original pricing expectations and state minimum requirements.”
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 the claims costs on this block of business –particularly in Connecticut - were much lower than the company had projected. Therefore, the Department rejected MetLife’s request on March 1, 2013, ruling that any increase at this time would be excessive.
The Department received no public comments during the 20-day public comment that the filing remained open.