An Act Concerning Long-term Care Insurance.
SB 1269 makes a broad set of changes to Connecticut’s long-term care insurance laws, effective mostly January 1, 2026. It updates the statutory definitions and regulatory framework for individual and group long-term care policies, including policies paired with life insurance or annuities through long-term care riders. The bill requires additional consumer disclosures for riders, preserves a 30-day cancellation right for certain riders, and clarifies that long-term care benefits provided through these products are subject to applicable state and federal requirements, including suitability, nonforfeiture, and qualifying-event standards.
The bill also changes how long-term care policies are priced and reviewed. It lowers the minimum loss ratio for individual policies from 60% to 65% for group policies and keeps rate filings subject to commissioner approval, but it tightens premium increase limits by prohibiting requested increases above 10% in a filing, with a special rule limiting increases for policies held at least 15 years to no more than the most recent annual CPI-U. It expands required consumer disclosures about future rate increases and prior rate history, and it removes references to the commissioner’s prior “minimum set of affordable benefit options” framework by repealing section 38a-475a.
The bill also creates a new state income tax credit for eligible taxpayers who pay premiums for a long-term care policy for themselves. The credit equals 20% of premiums paid and is available only to Connecticut residents with federal adjusted gross income under $200,000, beginning with taxable years starting on or after January 1, 2026. In addition, the Insurance Department must submit two reports by February 1, 2026: one evaluating an alternative pool for long-term care policyholders with coverage in excess of 20 years, and another evaluating the individual and group long-term care premium rate filing processes.
Overall, the committee sentiment appears strongly favorable: the bill was reported out of the Insurance Committee as a Joint Favorable Substitute and passed the committee vote 12-1. The structure of the bill suggests an effort to improve consumer protections, increase transparency around premium increases, and support long-term care coverage affordability while preserving insurer flexibility to offer riders and policy modifications.
The main points of contention are likely to center on affordability, rate regulation, and insurer obligations. Consumer advocates and policymakers concerned about premium spikes would likely support the tighter rate-increase limits, enhanced disclosures, and tax credit, while insurers may be concerned about the new constraints on pricing, the reporting requirements, and the repeal of the prior affordable-benefit option framework. The report on an alternative pool for very long-duration policyholders also signals ongoing concern about the long-term sustainability of the market.
The bill amends Connecticut insurance statutes governing individual and group long-term care policies, life insurance policies with long-term care benefits, and annuity contracts with long-term care riders. It revises sections 38a-458, 38a-430, 38a-501, and 38a-528, repeals section 38a-475a, and adds a new income tax credit for qualifying residents who pay long-term care premiums. It also directs the Insurance Department to produce two reports for the legislature, one on an alternative pool for long-duration policyholders and one on premium rate filing processes. The changes affect insurers, insurance producers, policyholders, certificate holders, and taxpayers who purchase long-term care coverage.
The bill appears to have broad support in committee, as reflected by the 12-1 Joint Favorable Substitute vote. The overall tone of the legislation is consumer-protective and reform-oriented, with an emphasis on affordability, transparency, and oversight of long-term care insurance. The near-unanimous vote suggests that most committee members viewed the bill as a constructive response to long-term care market concerns, even if some details remained controversial.
The likely areas of disagreement are the bill’s premium-rate restrictions and the repeal of the existing affordable-benefit-option structure. Insurers may object to the tighter limits on requested rate increases, the expanded disclosure obligations, and the new reporting requirements, while consumer advocates may favor those provisions as necessary protections against steep premium hikes. Another possible point of contention is the new tax credit, which helps middle-income residents but may be viewed as insufficient by some and too costly or broad by others. The report on an alternative pool for policyholders with coverage beyond 20 years suggests unresolved concerns about how to sustain long-term care coverage for older, long-duration policyholders.