CID: Long-Term Care Rate Filing - MedAmerica Insurance Co. (Individual 2004-2007)

Long-Term Care Rate Filing - MedAmerica Insurance Co. (Individual 2004-2007)

Rate request: 109.8 percent average increase

Decision: Disapproved, limited to an 15 percent increase on June 22, 2017

On April 5, 2017, MedAmerica Insurance Company requested an average increase of 109.8 percent for individual long-term care plans. The plans were sold in Connecticut from 2004 to 2007 and are no longer being marketed.

There are approximately 100 policies currently in effect in Connecticut.

The company said in its filing that the increase was 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. It also noted that the interest it is receiving on its investments earmarked to pay for future claims is lower than expected.

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 this block of business in Connecticut has performed worse than expected, however it is only reflective of one year. In fact, since 2005, there has been very few claims made on these policies. As a result, the Department disapproved the initial increase request and instead limited the increase to 15 percent on June 22, 2017.


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

Content Last Modified on 6/28/2017 3:17:23 PM