I must admit I was more than a little startled to read Jim Connollys dispatch from the recent spring meeting of the National Association of Insurance Commissioners wherein he reported that two commissioners, in the midst of a discussion about regulating long term care insurance, had raised the question of whether the product should continue to be sold at all.
This, I thought when the story came in, was an overreaction to a product that, while it has taken a disappointingly long time to gain traction in the marketplace and has had its share of bumps in the road, nevertheless serves a pressing and crucial need in our aging society.
This need notwithstanding, Wisconsin Insurance Commissioner Jorge Gomez said that discussion may be needed to determine “whether or not it [LTCI] is viable and should even be sold.”
Connolly also reported that Florida Commissioner Kevin McCarty concurred, commenting, “the overarching issue is whether the product is suitable for anybody.”
Im here to tell Mr. McCarty that, yes, the product has been suitable for at least one anybody and that person, namely, was my mother. After my father died and she came to live with us, I prevailed upon my mother to buy an LTC insurance policy when she was in her mid-70s. When later she suffered a truly debilitating stroke, it was the LTCI policy that allowed us to findand affordan exemplary nursing home close enough to my home so that we could visit her frequently.
Did we once ever have a problem with the carrier? Never. Not once did they balk or even hesitate at paying the monthly benefits.
That experience made me a true believer in the product, whose mission I have advocated many times in this publication, as well as in numerous conversations with friends and acquaintances. Many of these have been moved to purchase LTCI because of my experience with the product.
Of course, there are naysayers who will say that unfortunately my experience with the product, as good as it was, is in the minority and that many people have had their share of headaches in dealing with carriers.
They will tell of folks who have been crushed by stiff premium hikes when they thought they had purchased a product whose premiums were guaranteed to remain the same.
They will tell you of policyholders who have had to wrestle with their carriers in order to get reimbursed or have their claims paid.
They will tell you of agents who didnt explain the provisions of the contract sufficiently or at all and who caused a policyholder to think something was covered when indeed it was not.
And all of this I would have to admit is true. But I also have to say that all of the above are fixable. Indeed, isnt that where regulation comes in?
If ever there was a scenario where the old adage about not throwing out the baby with the bathwater applied, this is it.
Or, to fall back on another bit of time-tested wisdom, Messrs. Gomez and McCarty should not let the perfect become the enemy of the good.
And LTCI is good.
Reproduced from National Underwriter Edition, March 25, 2005. Copyright 2005 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.