BOSTON-- A National
Association of Insurance Commissioners' task force studying a uniform long-term
care insurance rate review proposal met opposition.
The Long-Term Care
Insurance Task Force tabled a request to form a subgroup to study the idea
after members, industry representatives and consumer groups questioned the
idea.
"We think this
is a significant misuse of market conduct authority," said Birny Birnbaum,
executive director of the Center for Economic Justice. "We don't see where
this is needed. Nothing prevents these states from coordinating."
The proposal is
relatively simple: streamline the LTCi rate review process so multiple state
insurance departments are not duplicating the same work, while insurers are not
answering the same questions over and over. Time and money would be saved and a
uniformity would emerge over time.
"Long-term
care insurance is a complicated product and it is difficult to justify the
resources required to develop expertise independently at each state insurance
department," the proposal reads. "We believe that it is vital that
the regulators seek ways to grant justified long-term care rate increases in a
more rational, efficient and uniform way."
A popular product
in the 1990s, LTCi was badly underpriced and many insurers sought, and continue
to seek, significant rate hikes to stabilize their books.
NAIC developed a
similar uniform process for market conduct and other financial examinations.
"As
commissioners, none of us likes to approve rate increases," said Dean
Cameron, Idaho insurance commissioner. "One of the things we do is look at
what other states are doing. It can be confusing."
But Birnbaum, a
long-time advocate for consumers, said the rate-review coordination is beyond
the purview of the NAIC.
Cameron, co-chair
of the task force, said the group will develop a more specific motion on the
idea and return to it in a future conference call.
InsuranceNewsNet
Senior Editor John Hilton has covered business and other beats in more than 20
years of daily journalism. John may be reached at john.hilton@innfeedback.com. Follow
him on Twitter @INNJohnH.
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