CID: Long-Term Care Rate Filing - Lincoln National Insurance Company (Individual)

Long-Term Care Rate Filing - Lincoln National Insurance Company (Individual)



Rate request: 30 percent

Decision: Disapproved, limited to 15% increase on February 3, 2017

On January 12, 2017, Lincoln National Insurance Company requested a 30 percent increase on a block of business of individual long-term policies which were sold from 1991-1996 and cover nursing home care.

These policies are no longer being marketed. There are 56 policies in force in Connecticut.

The company said in its filing that the increase was needed because there are more policies in effect than expected. As a result, over the life of these polices the expected demand for benefits and the higher cost of those benefits exceed original pricing expectations.

Connecticut law requires a company to spend at least 60 percent of premium received on benefits over the lifetime of the policy, a factor known as the “loss ratio.” Lincoln Financial said it anticipates its loss ratio at nearly 94 percent over the life of these policies.

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 is performing better than the company’s national market. However, benefit costs have already exceeded the statutory minimum of 60 percent of premium and the Department agreed that some rate increase was warranted. As a result, the Department disapproved the initial request of a 30 percent increase and instead limited it to an increase of 15 percent on February 3, 2017.


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


Content Last Modified on 2/3/2017 9:55:13 AM