CID: Long-Term Care Rate Filing - Brighthouse Life Insurance Company (Individual: 1992-1994)

Long-Term Care Rate Filing - Brighthouse Life Insurance Company (Individual: 1992-1994)

Rate request: 21 percent increase

Decision: Approved January 24, 2018

On October 11, 2017, Brighthouse Life Insurance Company requested an average increase of 21 percent for a small book of business individual long-term care plans offered through the state of Connecticut’s Partnership program. The plans were marketed from 1992 to 1994 and are no longer being offered. There are approximately 40 policies currently in effect 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. Brighthouse says it has been paying benefit costs longer than expected and there are more policies in effect that what the company had anticipated.

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 even with this small block of business, the company has already spent well over the statutory loss ratio minimum of 60 percent, meaning at least 60 cents of every premium dollar must be spent on benefits over the life of the policy. In fact, the Department found that the company is spending close to $1.90 of every premium dollar on benefits. As a result, the Department agreed that a rate increase was actuarially warranted and approved the increase on January 24, 2018.

Under Connecticut law, increases of 20 percent or more must be phased in over three years. The company said it would offer its policyholders benefit options in order to mitigate the impact of a rate increase.


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

Content Last Modified on 1/24/2018 2:14:43 PM