Transamerica Life Insurance Company (Individual)
Rate request: 30 percent increase
Decision: Approved on November 26, 2018
On October 10, 2018, the Transamerica Life Insurance Company filed for a 30 percent rate increase on several of its individual long-term care policies, which are no longer being marketed in the state. There are approximately 5,650 of these policies currently in force in Connecticut.
The company says it is seeking the increase because actual claims costs far exceeded projected costs that were calculated when the product was originally priced.
Unlike medical health insurance with premiums set to cover expenses incurred only during the upcoming policy year, long term care premiums are set to cover expenses that are not expected to occur until a distant date, sometimes 20 years in the future.
After an actuarial review, the Department determined that the experience on this closed block of business is worse than expected and continues to deteriorate. The statutory lifetime loss ratio of 60 percent has already been met. As a result, the Department agreed that a rate increase is warranted and approved the rate increase request on November 26, 2018.
The company said policyholders will be given the option to offset the increase and lower their premium by reducing their current benefits. Under Connecticut law, long-term care rate increases of 20 percent or higher must be phased in over three years or more.
Find the filing documents here at Long-Term Care Insurance Rate Filing