In December 2012, we posted a blog regarding laws protecting Long Term Care Insurance consumers. Long Term Care is becoming an increasingly important area of focus as our population ages. However, the data inescapably indicates that LTCI is far more of a women’s issue than a men’s issue.
The New York Times recently published an article highlighting the special issues that women face as LTCI consumers. From a financial perspective, the Long Term Care Insurance market has been shrinking–with many carriers ceasing to sell policies altogether and others raising premiums by significant amounts–as the aging American population has increasingly come to call on benefits and insurers realize the true cost of the policies to their bottom lines. This issue is magnified in the case of women, who statistically live longer than men and consequently cost insurers the majority of money in LTCI benefits. Genworth Financial, the top LTCI carrier in the country, has announced that it will be raising premiums by up to 40% for single women applying for coverage. This “gender-distinct” pricing is legal in 48 states, including New Jersey. Statistics cited in favor of such pricing increases center around the fact that women have, on average, longer life spans than men. They are therefore more likely to be widowed and living alone by the time they are elderly, or to reside in nursing homes whose costs are covered by LTCI. These difficulties are in addition to increasing stringencies in the underwriting process, including home visits rather than telephone interviews, reduced inflation protection, and longer elimination (waiting) periods. More cynical speculators opine that the true reason is lower interest rates set by the Federal Reserve, which reduces insurers’ returns on invested premiums.
Despite the intensified shift toward gender-distinct pricing and stricter underwriting, insurers in New Jersey are bound by the terms of the New Jersey Long Term Care Insurance Act, which regulates the underwriting and pricing schedules of LTCI policies.
We at Bonny G. Rafel are experienced in advocating for the rights of LTCI policyholders. Contact us for a consultation if you or a loved one is experiencing difficulties in dealing with an LTCI carrier.
– Sara E. Kaplan, Esq.