Is Your Long-Term Care Insurance Company Solvent?

The Wall Street Journal reported last month about growing concern among consumers about the safety of their insurance policies as insurers of all sizes suffer losses from their bad investments. Other carriers are being “dragged down by higher than expected claims in areas like long-term care insurance.” M.P. McQueen, “Worry Grows Over Insurers as Ratings Slip.”

The article refers to recent events in which regulators took over long-term care subsidiaries of Conseco Inc. and Penn Treaty American Corp. because their reserves fell below state-mandated levels of available capital.

“More trouble could be on the horizon,” writes McQueen. “More than a dozen major insurers have seen ratings downgrades in recent weeks, and several have dropped into categories reflecting relatively weaker financial health. Analysts say their ability to pay claims could be affected by continuing investment losses.”

We’ve been documenting this growing problem on our blog for some time now. And our best advice to consumers with potential claims is not to wait until you hear your long-term care insurer is targeted by regulators. Investigate their financial status now, and if the numbers worry you, perhaps start looking for alternate coverage. Talk to your agent or financial advisor, who may be able to transfer you into similar policies at a more secure company. It may cost you more, but that is better than paying for something that may ultimately have no value. If you already have a claim make sure you pursue it actively and expeditiously. If you need help, call us (800-446-7529), or any other person you know and trust who can help you.

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