Prudential to Discontinue Sales of Its Individual Long-Term Care Insurance Products
Prudential announced today that it will discontinue sales of individual long-term care insurance. Below is the official announcement.
Prudential LTCi News
After a thorough analysis of our long-term care insurance business, we’ve made the difficult decision to discontinue sales of our individual long-term care insurance products, including LTC3SM, LTC EvolutionSM, and our multi-life programs (ESP and Affiliation). We will continue to market our group long-term care insurance products, Solid SolutionsSM and LTC123SM. Our decision reflects the challenging economics of the individual market and our desire to focus our resources and capital on the group market, where we see the greatest opportunity.
Our decision to stay in the group long-term care insurance business, which we have proudly been in for more than 25 years, also reflects the strong strategic fit with our broader group insurance product offerings, including life, accidental death and dismemberment (AD&D), disability, and dental. The demographics of the employer market align well with our focus on providing voluntary benefit solutions to individuals through our group marketing and distribution platforms.
Timing
All individual long-term care insurance applications must be received by March 30, 2012 to be considered for issuance. Any applications received after March 30, 2012 will not be processed.
Employer Sponsored Program (ESP) and Affiliation cases must be approved on or before March 30, 2012. Once approved, applications under these programs must be received no later than 60 days from the date of case approval or May 30, 2012, whichever is sooner.
Existing Policyholders
We take our commitment to our policyholders seriously. Existing individual long-term care insurance policyholders will continue to be covered under the terms of their Prudential LTC insurance policies, which are guaranteed renewable. This means that as long as premiums are paid on time, and benefits are not exhausted, coverage cannot be cancelled, although premiums can be changed based on experience, on a class basis, in accordance with the terms and conditions of the policy.
Policyholders will continue to receive customer service and claims support. Plan upgrades will be allowed as permitted by their contract.
All existing individual long-term care insurance policyholders will receive a letter with the above details in the next few weeks. Click here to see a copy of the letter.
ESP and Affiliation Cases
All ESP and Affiliation cases approved prior to January 30, 2012 will be closed to new entrants effective March 30, 2012. For cases approved after January 30, cases will be closed 60 days from the case approval date but no later than May 30, 2012. Please notify your ESP and Affiliation plan sponsors accordingly.
Producer Commissions and GA Bonuses
Commissions will continue to be paid out per the terms of your contract. GA bonuses will be paid in 2012 using the 2011 formula, pro-rated based on four months of production. Applications signed on or before March 7 and received by Prudential on or before March 16 will be counted toward the 2012 bonus. Applications signed March 8 or later, or received by March 17 or later, will not be counted toward the 2012 bonus. You’ll be receiving additional information about the 2012 bonus program shortly.
We would like to thank our entire producer community for all of their support, hard work, and partnership over the years. Together we helped hundreds of thousands of Americans protect their assets, retirement income, and independence.
Producer Appointments
Producer appointment paperwork received on or before March 30, 2012 will be processed as long as it’s accompanied by a completed application. Any appointment paperwork received after March 30, 2012 will not be processed.
Group Long-Term Care Insurance
As stated above, this announcement has no effect on our group long-term care insurance business. We expect to continue as a leader in the group market as we enhance our current product offerings and develop other innovative products for the employer and association markets.
Questions
We value our relationship and wanted you to have this information as soon as possible. Please click http://www.prudential.com/media/managed/FAQ_GA_PRULTC.pdf to review an FAQ document which will help answer many of the questions you may have.
If you have any additional questions related to this announcement, you may call 1-800-732-0416 or
Elite GAs may call 1-866-630-7203.
Prudential is proud of all that it has accomplished in the long-term care insurance business for more than 25 years. We look forward to continuing to serve as a world leader in the financial services industry and to continuing our tradition of helping people handle their toughest financial challenges.
Sincerely,
Malcolm Cheung
Vice President
Prudential Long-Term Care Insurance
