Relating to regulation of premium rates for long-term care insurance.
Impact
The bill significantly amends the Texas Insurance Code by introducing a procedure for the approval and disapproval of long-term care premium rates. Specifically, it empowers the Commissioner to disapprove rates that don't meet actuarial justification or regulatory standards, which could prevent consumers from facing sudden financial burdens due to unexpected rate increases. Additionally, insurers are mandated to notify policyholders of scheduled rate increases 45 days prior to when the new rates take effect, ensuring policyholders are adequately informed and can plan accordingly.
Summary
S.B. No. 963 aims to regulate premium rates for long-term care insurance in Texas. Under this legislation, any premium rate increase for long-term care insurance must be filed with the Department of Insurance and approved by the Commissioner. This provision is designed to ensure that insurers cannot impose rate increases without proper justification, adhering to established actuarial standards. This additional level of oversight is intended to protect consumers from unjustifiable or excessive hikes in their insurance premiums, thereby enhancing financial security for policyholders.
Contention
While S.B. No. 963 appears to gain bipartisan support due to its consumer protection objectives, there are still points of contention. Opponents may argue that stringent regulation on premium increases could inadvertently stifle the market for long-term care insurance, making providers reluctant to issue policies or offer necessary rate adjustments that reflect the realities of care costs. On the other hand, supporters will assert that consumer protection should take precedence, especially in an industry where individuals often rely heavily on insurance coverage to navigate long-term health needs.