Information from the Office of Insurance Regulation re Long Term Care Insurance 3/10/2006
Jan 4, 2007
Below please find a press release issued by the Office of Insurance Regulation regarding Senate Bill 2290 and House Bill 1349 relating to Long-Term Care Insurance. Please feel free to contact this office with any questions or concerns that you may have.
Regards,
Katherine A. Scott
Legislators File Bills Aimed at Protecting Florida Seniors
Tallahassee � Sen. Mike Fasano, R-New Port Richey, and Rep. Frank Farkas, R-St. Petersburg, have filed significant legislation to provide consumer protection, stabilize long-term care insurance rates and ensure viability of long-term care insurance for Florida�s citizens.
Senate Bill 2290 and House Bill 1349 provide seniors with a contingency benefit provision option for those whose policies are in a closed block of business with skyrocketing premiums. Closed blocks of business are policies that are no longer issued, but are still in force for a group of policyholders with medical conditions that drive up the cost of premiums for the group.
“The premiums being paid by seniors are rising dramatically, while the value of the insurance benefits is eroding over time”, stated Sen. Mike Fasano. “Seniors and their families that are no longer able to afford this coverage will be provided with several options to cover the cost of long-term care insurance”.
The proposed legislation would give those policyholders in closed blocks the option of changing coverage or converting to a paid-up policy equal to the sum of all premiums paid during the life of the policy.
The proposed legislation also would provide for a standard benefit policy to make comparison shopping easier for seniors and their families to compare benefits and prices among policies offered.
“Many well-intentioned seniors plan for their future by purchasing long-term care policies, paying premiums for years by investing substantial resources,” Farkas said. “They should not be penalized at the time when they need the coverage the most. That is unfair!!”
In recent years, long-term care insurance policies have had premium increases topping 200%, a substantial financial burden for seniors and their families. Unexpectedly high premiums have forced many seniors to drop the coverage because they can�t afford the increasing cost.
The Florida Office of Insurance Regulation conducted a study of long-term care insurance rates, which provided a report summarizing the history of the long-term care insurance market in Florida, and formed a task force of legislators, insurance industry representatives and consumer representatives, and led to the Office�s legislative recommendations for the upcoming session.