Nov. 30—Maine's top insurance regulator is warning that long-term care insurance is likely to get a lot more expensive for some policyholders.
The insurance product, which generally covers the cost of services such as assisted living facilities for the elderly, could nearly triple in price next year for some of the thousands of Mainers who have it, according to state Insurance Superintendent Eric Cioppa. Long-term care insurance isn't widely used because it can already be prohibitively expensive.
Cioppa said in a news release Tuesday that the state Bureau of Insurance will hold a public forum Thursday to discuss proposed premium increases of 56 to 178 percent being sought by one insurer, Genworth Life Insurance Co.
Cioppa said there are nearly 4,100 Genworth policyholders in Maine who will be affected by the increases, which are being sought on eight groups of long-term care policies offered by the company. The largest block, Cioppa said, has 1,570 policyholders in the state, and Genworth is seeking a rate increase of 141 percent for that block.
Cioppa said other long-term care insurers have been seeking increases, as well.
"Due to insurers underpricing their products when they were first introduced on the market, the long-term care insurance industry has been strained for years," he said.
If left unaddressed, Cioppa said, the financial health of the insurers could be jeopardized by those low rates, but "substantial increases can have a big impact on policyholders, particularly those on fixed incomes."
Cioppa said Maine law requires companies to inform policyholders if they will seek rate increases. Genworth, based in Richmond, Virginia, has contacted its Maine policyholders directly about the rate-increase request. The bureau has received what it termed "a high volume" of calls about Genworth's plans.
Cioppa said it will take several months for the bureau to review Genworth's proposal and decide if an increase is justified and how much it should be. If the increases are approved, customers will get another notice from Genworth explaining the increases and any options they might have to minimize them.
Bureau of Insurance spokeswoman Judith Watters said 54 companies reported receiving long-term care premiums from Mainers over the past year, although only seven companies continue to sell policies here.
Typical long-term care insurance premiums range from $1,800 to $6,000 a year, Watters said. The increases sought by insurers range from the low single digits to more than 100 percent, with one company seeking a 200 percent premium increase, she said. Increases of 4 to 60 percent have been approved over the past year, she said, and insurers are encouraged to phase in large increases over two or three years.
Thursday's 1 p.m. hearing will be virtual, and those who wish to register should do so Wednesday on the bureau's website at maine.gov/pfr/insurance to receive an email with information on how to link to it. People can also register to participate by phone.