An Act Concerning Consumer Protection For Long-term Care Insurance.
Impact
By implementing these regulations, HB05804 is designed to protect consumers from potential abuses by insurance companies, particularly regarding premium hikes that could place a financial strain on policyholders. The requirement that carriers maintain a certain loss ratio before seeking increases could provide more stability in the insurance market and help maintain affordable long-term care options for residents. Additionally, the bill also calls for a financial health examination of the insurance company's parent organization, providing an additional layer of scrutiny intended to safeguard the interests of consumers.
Summary
House Bill 5804 aims to enhance consumer protections for individuals holding long-term care insurance policies. The bill proposes amendments to section 38a-501 of the general statutes, which sets forth requirements for long-term care insurance carriers before they can apply for a premium rate increase. Specifically, it mandates that these carriers must meet a minimum loss ratio of 60% and demonstrate that they have adequately sold policies to cover anticipated losses. The intent behind this legislation is to ensure that policyholders are treated fairly and are not subjected to unjustified increases in their premiums.
Contention
While the bill is aimed at providing protections for consumers, potential controversy may arise regarding the impact on insurance carriers. Some stakeholders may argue that these requirements could hinder the companies' ability to adjust their pricing strategies in response to market conditions. There is an ongoing debate about the balance between protecting consumers and allowing insurance providers the flexibility needed to remain solvent and competitive in the long-term care insurance market.
An Act Concerning Insurance Market Conduct And Insurance Licensing, The Insurance Department's Technical Corrections And Other Revisions To The Insurance Statutes And Captive Insurance.