Union Security Insurance Company – Individual (2001-2002)
Rate request: 280.3 percent average increase
Decision: Disapproved, limited to 40%
On March 5, 2019 Union Security Insurance Company requested an average increase of 280.3 percent on a block of business of individual long-term policies which were sold from 2001 to 2002.
These are no longer being marketed. There are about 37 policies in force in Connecticut.
The company said in its filing that the increase is needed due to higher incidence and longer lasting claims, particularly at the older attained ages. The experience on this block of business is worse than anticipated 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 for both Connecticut and nationwide has been higher than anticipated, especially in Connecticut recently. As a result, the Department disapproved the initial rate increase request but approved a 40 percent increase on July 29, 2019, to be phased in over three years.
The new rate will take effect 60 days after the company has notified its policyholders.
Find the filing documents here at Long-Term Care Insurance Rate Filing