Thursday, October 21, 2010

John Hancock will raise long term care premiums by 40%

Kimberly Lankford of Kiplinger’s Money Power has an article on p 23 of The Washington Examiner on Thursday Oct. 21, “What should you do about your long-term care policy?” This refers to (another) announcement from John Hancock that it would raise premiums for long term care by up to 40%.

Hancock says that the “duration” of claims from 1990 to 2010 has been much higher than expected. That’s because people can live longer with modern medications and good home health care. Hancock has already stopped selling policies with lifetime benefits as of June 2010.

Policyholders can pay higher premiums for the same coverage, or they may reduce the benefit period or the monthly or daily benefit amount.

We haven’t seen a political debate on better tax-free “savings accounts” for long term care, but I am surprised that conservatives (and libertarians, or those of the Steve Forbes ilk) haven’t been pressing more for such a discussion.

Time Magazine has a major issue on this with Alzheimer’s that I’ll cover later.

The online version of Examiner doesn’t have this story yet. I’ll provide the link as soon as it appears. An earlier article by her had appeared in February, here.

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