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Maryland Insurance Administration • 800-492-6116 • www.insurance.maryland.gov
THE MARYLAND LONG-TERM CARE INSURANCE PARTNERSHIP PROGRAM
Q: WHAT FACTORS DO INSURANCE COMPANIES CONSIDER TO
DETERMINE THE PREMIUM RATES?
A: When insurance companies initially develop rates for long-term care insurance
premiums, the main actuarial assumptions taken into account include lapse
assumptions, mortality assumptions, morbidity assumptions and interest rate
assumptions. Additionally, an insurance company may oer you discounts
when you are initially purchasing a long-term care insurance policy, for being a
very healthy applicant (i.e. passing more rigorous underwriting criteria), being
married, or living with someone. Finally, long-term care insurance is generally
oered on an issue-age basis, meaning the younger you are when you buy the
policy, , the lower the insurance premium.
Q: IS THERE A MAXIMUM ALLOWED ANNUAL PREMIUM INCREASE FOR
MY LONG-TERM CARE INSURANCE?
A: Yes. Maryland regulations, COMAR 31.14.01.04(A)(5), provides that except
under certain exceptional circumstances, a long-term care insurer cannot
raise your premium by more than 15% in a 12-month period. Furthermore,
COMAR 31.14.02.06(B)(2)(d) states that, except under limited circumstances,
your renewal premium rate cannot be greater than new business premium rates,
except for dierences attributable to benets.
Q: DO I HAVE ANY OPTIONS OTHER THAN ACCEPTING THE PREMIUM
RATE INCREASE?
A: Yes. If you would not like to accept the full premium rate increase, COMAR
31.14.01.36 requires every long-term care insurance policy and certicate to
include a provision allowing the policyholder to reduce coverage and lower the
policy premium in at least one of the following ways:
Reducing the maximum benet; or
Reducing the daily, weekly, or monthly benet amount.