Poorly thought out efforts to fight long-term care insurance (LTCI) rate increases could have unintended consequences, state insurance regulators said Monday, in Chicago.
In some cases, regulators said, increase limits in one state, or several states, may push up the size of the rate increases an insurer is asking for in other states.
Paul Lombardo, an insurance regulator with the Connecticut Insurance Department, suggested that unrealistic restrictions on LTCI rate increases could also threaten an insurer’s solvency.
(Related: ILTCI Conference Attendees Soldier On)
He said insurance producers recently came to the Connecticut department and asked regulators there to stop approving LTCI rate increases.
Lombardo recalled asking the producers, “Do you honestly think that’s the answer?”
If the producers’ proposal pushed an issuer out of business, “How do you explain getting 20% on the dollar for your policy, if that?” Lombardo asked.
Lombardo appeared on a panel at the 2019 Intercompany Long Term Care Insurance Conference along with Rhonda Ahrens of Nebraska, Jessica Altman of Pennsylvania and Fred Andersen of Minnesota.
Altman said she does get many questions about LTCI rates.
“It’s the hardest thing I have to deal with,” Altman said.
But Altman said she finds that legislators and others are open to learn about the reasons for the increases, when they can see that insurers are being open.
Ahrens said Nebraska rejects rate hike notification letters that seek to put the rate hikes in an overly positive, misleading light.
“We require companies to be as forthright as possible,” Ahrens said.
Altman and Andersen said they would like to see insurers coming to them with new ideas about how to offer consumers protection against long-term care risk, and for making existing types of LTCI products work better.
Andersen talked about seeing a table showing that traditional, stand-alone LTCI continues to be the best way to maximize the amount of protection a consumer has against catastrophic long-term care risk.
“I don’t want to give up on the stand-alone long-term care insurance,” Andersen said.
Earlier in the day, Peggy Hauser kicked off the proceedings by announcing that the ILTCI Association, a nonprofit group, has succeeded at attracting 1,100 people to the Sheraton Grand Chicago for the conference, which started Sunday and is set to end Wednesday.
Traditionally, the conference has served insurance company executives and actuaries affiliated with the Society of Actuaries. In recent years, the ILTCI Association has built up a session track aimed at LTCI agents and brokers. This year, the producer track attracted about 230 producer attendees, Hauser said.
The ILTCI Association gave a lifetime achievement award to Stephen Moses, who has been fight for years against what he sees as misguided moves to have Medicaid nursing home benefits crowd out private LTCI coverage.
Here are some of the ideas coming up at the conference Monday.
1. Treat market conduct examiners well.
Stephanie Duchene of Mayer Brown LLP, Michele Jordan of John Hancock, and Allison Kusel of Genworth appeared at a panel on market conduct examination procedures and trends.