Ask Terry Questions Spike in Premiums for Long Term Insurance Policies

Spike in Premiums for Long Term Insurance Policies

By Terry Savage on June 19, 2018 | Insurance & Annuities

Terry, my wife and I purchased long term care insurance policies from Northwestern Mutual in 2009, and our premiums have been the same every month every since until…now. Starting in June, this company will be hiking premiums by a whopping 40% for Illinois residents on the anniversary of a policy purchase. Then, we’re told this company plans to hike premium prices another 40% in 2022! We are told that Illinois insurance regulators had to approve any such increases, as with other insurers’ requests as well, I presume. I have also seen litigation over these price increases. What is quite bothersome is that such policies are for the later years, when nursing or in-home care will be required by those on fixed incomes. The only options we are told that are available are either to stop paying for the policy or limit its benefits (amount available for such care, duration of amounts payable, etc.). Isn’t there anything the Illinois resident that purchased such long term care policies can do? Addressing it on your on air would be helpful too. Thank you.

Terry Says

Full disclosure: It happened to me, too! I’ve been working on a column on this for the past several weeks, and you’ll see it soon. I have discussed with company management and actuaries, and with lawyers.
Basically, they are within their rights to do this hike. Don’t drop your policy. If you can’t pay more, then limit some of the benefits. Details to come in a column coming in the next two weeks.

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