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Officials Ask Whether LTC Insurance Should Be Sold

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Some insurance regulators are asking whether insurers should be selling long term care insurance.[@@]

The comments surfaced during a talk about how to improve the Long Term Care Insurance model act and regulation. Some of the talk focused on the issue of post-claims underwriting. It occurred here during a gathering of the senior issues task force at the spring meeting of the National Association of Insurance Commissioners, Kansas City, Mo.

Wisconsin Insurance Commissioner Jorge Gomez said that it was possible that a discussion of LTC insurance was needed to determine “whether or not it is viable and should even be sold.”

Florida Insurance Commissioner Kevin McCarty agreed, saying, “The overarching issue is whether the product is suitable for anybody.”

The remarks followed a presentation by Paul Roller, an attorney who detailed alleged industry problems centering on post underwriting claims in which claims were denied 7 years after a contract holder started paying premiums on the contract because the contract holder was deemed to have had the condition at the time of purchase.

Roller discussed problems he had found in representing clients on long term care cases. He talked about incentive-based systems that pay bonuses based on dollars saved on long term care policies, the recission rates for LTC insurance contracts that show up on Schedule F filings of companies’ filed financial statements and his belief in the need for standardized applications.

But Lynn Boyd, a representative from the American Council of Life Insurers, Washington, said the problems that were being discussed emanated from a few insurers. ACLI has been responsive in trying to effect change where needed, and, if there is a problem, to identify it so that work can be done on it, Boyd said.


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