Senate Bill S4328

                                
 
BILL NUMBER: S4328

SPONSOR: MAYER
 
TITLE OF BILL:

An act to amend the insurance law, in relation to requiring the super-
intendent of financial services to make public any rate filing or appli-
cation submitted by long term care insurance carriers who propose to
raise long term care insurance premiums

 
PURPOSE OR GENERAL IDEA OF BILL:

To increase transparency in the long-term care insurance premium rate
increase approval process by providing for public disclosure and public
comment with respect to a rate increase application, and to require that
the best interest of the policyholders be explicitly considered by the
Department of Financial Services when making a determination as to such
application.

 
SUMMARY OF PROVISIONS:

              

Section 1 requires consideration of the best interests of policyholders
when the Department of Financial Services makes determinations as to
whether premium rates are reasonably related to benefits provided and
are self-supporting, and that such consideration be made publicly avail-
able in writing.

Section 2 requires that the Department of Financial Services:

(i) make all applications by insurers for premium increases publicly
available on its website within seven days of filing;

(ii) provide for 30 days of public comment on the rate increase applica-
tion on its website; and

(iii) consider the best interests of the policyholders when making a
determination on the rate increase application, and publish a written
statement on its website regarding such analysis, with relevant detail.

Section 3 provides the effective date.

 
JUSTIFICATION:

Long term care insurance can mitigate the costs of care and help with
daily activities that people may need as they age. Medicare generally
does not pay for these expenses, so without long-term care insurance is
a way to avoid paying out of pocket later. The catch is that premiums
for this insurance are high, and for many, they increase dramatically
and unexpectedly until they are unaffordable and dropping the policy
becomes the smart financial decision.  An article in the New York Times
on August 23, 2019, "Your Lone-Term Care Insurance Rate Spiked. Now
What?"  (https://www.nytimes.com/2019/08/23/ yourmoney/long-term-care-
insurance-prices.  html) details the challenges of struggling to keep up
with skyrocketing premiums. Many consumers purchased policies with the
understanding that their premiums would not change, and feel blind-sided
and voiceless when they find out that their premiums will increase
dramatically.


This legislation will give insureds advance notice and a stronger voice
in the process when insurers seek premium increases by increasing trans-
parency and providing for public comment at the time that the rate
increase applications is made, and by requiring the Department of Finan-
cial Services to publicly opine on the best interest of policyholders
with respect to the rate increase application in question.

 
PRIOR LEGISLATIVE HISTORY:

New bill

 
FISCAL IMPLICATIONS:

To be determined.

 
EFFECTIVE DATE:
This act shall take effect immediately.