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July 14, 2009 at 08:00 PM
Texas insurance regulators are working out rules to require long term care carriers to get the state insurance commissioner’s approval for rates on policies sold in the state.
Gov. Rick Perry, R, has signed a bill, C.S.S.B. 963, that mandates that LTC insurance rate increases be submitted to the commissioner and allows the commissioner to reject rate requests that are not actuarially justified.
The new statute requires insurers whose rate increases are approved to give policy holders at least 45 days’ notice before effecting an increase and to offer policyholders an alternative, such as a policy with reduced benefits.
The legislation takes effect Sept. 1.
In an analysis, state Sen. Rodney Ellis, D-Houston, the bill’s author, maintains that some Texas consumers have paid higher rates for LTC insurance to make up for lower rates the carriers have earned in states that denied or reduced requested rate increases.
