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Connecticut rejects group LTCI rate change request

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The Connecticut Insurance Department has rejected efforts by John Hancock Life Insurance Company to increase rates on 1,800 long-term care insurance (LTCI) policies by an average of about 58.1 percent.

“Experience is coming in well below expectations in Connecticut,” Paul Lombardo, a Connecticut department actuary, wrote in a memorandum explaining the decision.

Throughout the country, the actual amount of benefits paid has been 104 percent of premium revenue, which is slightly worse than expected, but, in Connecticut, the inception-to-date loss ratio has been just 41 percent, Lombardo said.

Connecticut requires group LTCI plans in the state to have a loss ratio of at least 65 percent, Lombardo said.

John Hancock, a unit of Manulife Financial Corp., sold the LTCI policies through employer, union and association plans in Connecticut from 2001 to 2010. The company also sold similar policies in other states.

The company originally filed another application for an increase in 2011. The Connecticut department rejected that request in 2012.

John Hancock re-filed an LTCI increase request, arguing that its own calculations show that the performance of the block has been worse than expected.

Representatives from John Hancock were not immediately available to comment on the Connecticut ruling.

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