Regulators across the country continue to grant substantial long-term care rate increases on in-force blocks during the third quarter.
The most impactful approval took place in Virginia where John Hancock Life Insurance Co. (USA) could see its annual calculated premiums rise by $17.4 million. The increase will impact about 18,000 Virginia policyholders who have already seen their premiums rise on multiple occasions over the years. Depending on the policy series within the filing, the most recent approval would be the third or fourth such increase. In addition, John Hancock indicated that it believes additional rate hikes will be needed unless actual experience improves.
In total, John Hancock received approval to raise its long-term care, or LTC, rates in at least 10 states during the third quarter. All told, those increases could boost the insurer's annual premiums by $35.1 million.
Genworth Financial Inc.'s calculated annual premium increase of $62.5 million was the biggest aggregate total for the third quarter. The most impactful filing for the largest U.S. LTC provider occurred in Nebraska, where calculated annual premiums are expected to rise by $11.1 million on an average approved rate increase of 68.5%. The rate hike will be implemented over a three-year period and impacts Genworth's Choice 2 and 2.1 policy series.
The Nebraska Department of Insurance considers this approval an "end game increase" and said it would not consider any more increases "without deterioration in experience that results in a higher projected future loss ratio" than is currently forecast.
On its third-quarter earnings call, Genworth CFO Daniel Sheehan said the company accelerated its filing activity during the quarter and expects to continue that process through the end of the year. Some of those new filings included newer product series which Genworth has yet to seek premium hikes.