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Consumer Alert: Long-Term Care Insurance Rates on the Rise, Talk to Your Financial Adviser About What is Right for You

April 8, 2014
As long-term care insurance rates continue to rise, the Oregon Insurance Division is urging consumers  to carefully examine their options and how this type of insurance fits into their overall financial strategy.    “Consumers facing rate increases may have options to reduce their premiums,” said Insurance Commissioner  Laura Cali. “For consumers thinking of buying this type of insurance, it’s important to consider whether it  complements their long-term financial goals.”    In recent months, the Insurance Division has approved long-term care rate increases affecting more than 29,000  Oregonians, and several other rate increases are pending. The division has reduced the increases during the  review process – companies originally requested an average 45 percent increase, but the division approved an  average 26 percent increase.    “While these increases are still significant for consumers, they are much lower than what was originally  requested,” Cali said. “By reducing the rate increases, we hope to give policyholders the ability to maintain their  coverage or to adjust their benefits so that they can still afford it and be able to access benefits should they need  long-term care.”    Long-term care insurance covers people who are chronically ill in a variety of settings – at home, in assisted  living, or in a nursing home, for example. Typically, people begin paying premium before they need benefits.  They become eligible for benefits if they can no longer perform certain daily activities such as eating, dressing,  or bathing or if they have a mental impairment such as dementia.    Long-term care is a relatively new type of insurance and insurers nationwide have been raising rates over the  past several years. That’s due to the fact that policyholders kept their policies longer than expected and are  living longer than projected, using more benefits. In addition, low interest rate returns are not keeping pace with  increases in the costs of long-term care services.    Consumers will receive letters from their insurance companies at least 45 days before an increase takes effect.  The Insurance Division has also asked companies to notify policyholders of their intentions for future rate  increases.    In many cases, consumers facing rate increases can reduce their premium by reducing the benefits covered by  their policy. For example, they could reduce their inflation protection, which means their policy would cover a  smaller percentage of the costs of care in the future. Other options for reducing benefits range from reducing the  daily benefit amount to shortening the benefit period.    NEWS  RELEASE  Director’s Office, 350 Winter St. NE, Room 200, Salem, Oregon 97301-38782  Deciding how to pay for long-term care services should be part of your overall retirement planning, Cali said.  As part of National Retirement Planning Week (April 7-11), the National Retirement Planning Coalition has  collected the latest resources to help consumers and financial professionals focus on long-term financial goals,  available at    A summary of the recent long-term care rate increases in Oregon is below. For a complete list of all the policies  affected – as well as pending requests – click here. For general information about long-term care insurance,  click here or call the Insurance Division consumer advocates at 1-888-877-4894.    Long-term Care Rate Increases  Company name  Average rate  increase  requested  Average rate  increase  approved  Number of  policyholders  affected  Ability Insurance Company/Medico Insurance Company 61% 31% 2,665 AF&L Insurance Company 99% 30% 20 Allianz Life Insurance Company of North America 25% 25% 1,141 American General Life Insurance Company of Delaware 25% 15% 130 American Republic Insurance Company 31% 31% 89 CMFG Life Insurance Company 50% 15% 126 Continental Casualty Company 80% 30% 2,503 Equitable Life & Casualty Insurance Company 43% 29% 3,340 Genworth Life Insurance Company 60% 21% 5,525 Jackson National Life Insurance Company 20% 15% 6 MedAmerica Insurance Company/Regence BlueCross  BlueShield of Oregon 22% 16% 726 Metropolitan Life Insurance Company (to be phased in  over 2 years) 58% 44% 2,867 Monumental/Transamerica Life Insurance Company 17% 17% 1,836 Mutual/United of Omaha Insurance Company 14% 14% 387 New York Life Insurance Company 18% 18% 1,214 Physicians Mutual Insurance Company 19% 19% 150 Provident Life and Accident Insurance Company 30% 15% 471 Prudential Insurance Company of America 44% 15% 372 Pyramid Life Insurance Company 50% 25% 105 RiverSource Life Insurance Company 16% 14% 1,864 Senior Health Insurance Company of Pennsylvania 20% 9% 380 State Farm Mutual Automobile Insurance Company 32% 32% 3,931 State Life Insurance Company 35% 25% 29 Total number of policyholders 29,877   The Insurance Division is part of the Department of Consumer and Business Services, Oregon’s largest business  regulatory and consumer protection agency. Visit