GENWORTH DROPS MULTI-LIFE AND GROUP LTCI

Deadline for Multi-life applications:  April 15, 2013.   Deadline for group (min 150 for employer-paid, 500 for employee-paid) is March 1, 2013.  On-going enrollments within established multi-life groups will be accepted up until July 1.

Now, what does this mean?  Well, as Genworth explains it, they think the multi-life market is going great, but they “… don’t feel [they] are in a competitive position to grow [their] share of that market.  [Their] current intention is to revisit new product offerings and revised underwriting practices once [their] primary priorities in the individual market are delivered.”

I have no idea what that means.  But, it would appear that they are placing  their full attention on the individual market.  That’s good sign unless their individual market is in trouble.  In California, they are vastly under priced compared to the competition.  Many agents (including me) have been illustrating them almost exclusively because of that.  Could that mean, though, that those that recently bought those low-cost policies will be up for a rate increase sooner than later?  Many of my LTCi colleagues believe that and have stopped selling Genworth.

As has been explained before, the LTCi market is in approximately the same place that the DI market was in the late eighties and early nineties:  carriers were leaving the market, some carriers were bought out, most repriced their contracts and/or eliminated certain benefits and features.  Many riders were dropped.  But, the DI market is quite rate-stable now and is doing well.  The last time I checked there were 26 carriers offering DI contracts in the US.  Perhaps the LTCi market will go through the same growing pains before things settle down.

The need is still there.  Recent surveys indicate an increased awareness and concern (if not outright fear) of what will happen to couples and their extended family if one of their elderly – excuse my bluntness – takes too long to die.  I am certainly being asked to run a lot of LTCi illustrations.  LTCi sales, however, are relatively flat.

There’s no better time than now to apply for and purchase long-term care insurance if you can medically qualify.  Even a small policy is better than nothing.  There are many ways to solve the problem of costly extended care.  Increasingly, it is simply one of the costs of growing older.