CID: Long-Term Care Rate Filing - MedAmerica Insurance Co. (Individual 1999-2004)

Long-Term Care Rate Filing - MedAmerica Insurance Co. (Individual 1999-2004)

Rate request: 130 percent average increase

Decision: Disapproved, limited to a 15% increase on May 23, 2018.

On April 25, 2018, MedAmerica Insurance Company requested an average increase of 130 percent for individual long-term care plans. The plans were sold in Connecticut from 1999 to 2004 and are no longer being marketed.

There are approximately 30 policies currently in effect in Connecticut.

The company said in its filing that the increase is needed because of higher than expected claims costs and a longer duration of paying those claims that was anticipated when this product was originally priced. The company indicated it is seeking a rate increase on policies with compound inflation protection. No rate increase is requested on policies without inflation protection.

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.

The company noted it would offer its customers options to reduce or change benefits to offset the impact of an increase. Under Connecticut law, increases of 20 percent or higher must be phased in over three or more.

After an actuarial review, the Department determined that while the company’s small, block of business in Connecticut is performing better than expected a small rate increase was warranted to cover the claims costs. As a result, the initial request was denied but the Department did approve a 15 percent increase on May 23, 2018.

The new rates take effect 60 days after the company notifies its customers.


Find the filing documents here at Long-Term Care Insurance Rate Filing

Content Last Modified on 5/29/2018 2:17:35 PM