The Senate Special Committee on Aging recently questioned regulators and representatives of the long term care (LTC) insurance industry about the state of the long term insurance market and introduced the Confidence in Long Term Care Insurance Act which is designed to curb premiums, train insurance sales agents and allow consumers to compare policies before purchase.

Senate questions LTC premium increases

The Senate Special Committee on Aging questioned long term care insurers about the state of the industry as more and more seniors struggle to keep up with premium increases. Reports of 50% increases are not uncommon as insurance companies seek to recoup some of their losses from the past when policies were priced far less than they are today. Long term care insurers told the Committee that the primary reason that policies were priced less was largely due to the industry not fully understanding how much health care costs would rise from the 1990's – when many long term care policies were sold – until today. While that may be so, certain members of Congress would like to make sure that consumers are adequately protected – and have introduced legislation to do just that.

S1177 – The Confidence in Long Term Care Insurance Act

Wisconsin Democratic Senator Herb Kohl, also the Chairman of the Senate Special Committee on Aging, recently introduced the Confidence in Long Term Care Insurance Act which – in conjunction with state partnership programs and National Association of Insurance Commissioners (NAIC) – would curb premiums, train insurance sales agents on policies and allow consumers to compare policies before making a purchase. If the Act becomes law and works the way it is intended, bad faith insurance lawsuits against long term care insurers may also decrease.

Bad faith insurance lawsuits

There have been many bad faith insurance lawsuits against insurers as more and more policyholders turn to their long term care policies for benefits – and insurers fight to keep their premium dollars without making benefit payments. The three areas the Act addresses have been key issues in many of the bad faith insurance lawsuits against long term care insurers. Here's why:

• Curbing premiums. Consumer advocate groups have long reported that seniors simply cannot afford the sometimes astronomical premium increases that go along with maintaining their long term care insurance policies and that many are forced to not renew their policies and go without coverage.
• Training sales agents. Many insurers simply did not train their sales agents about how long term care insurance policy coverage. Unfortunately, many agents told purchasers whatever they wanted to hear at the time – which often left them with broken promises when it came time to collect.
• Comparing policies. Similar to the problem of using untrained agents, many consumers were not given the chance to compare other policies to see which would provide them with the coverage they desired.

Experienced long term care insurance attorneys understand how insurers operate. If you've been denied your valid benefits or have received notices that your premiums will increase drastically, contact one to discuss your situation and evaluate your options.