An Act amending the act of May 17, 1921 (P.L.682, No.284), known as The Insurance Company Law of 1921, in long-term care, providing for premium rate increases.
Summary
HB950 amends Pennsylvania’s Insurance Company Law of 1921 to add new rules governing premium rate increases for long-term care insurance policies. The bill prohibits insurers from raising a policyholder’s premium because the insured is getting older or because the policy has been in force longer. It also sets a general annual cap of 15% on renewal premium increases for long-term care policies.
The bill further directs the Insurance Commissioner to disapprove a proposed rate increase if the benefits are not reasonable in relation to the premium, if the rate is excessive, unjustified, or unfairly discriminatory, or if the increase exceeds the 15% annual cap for a policy form. An exception allows a larger increase only if the insurer obtains commissioner approval and shows that higher-than-expected policy benefit utilization makes the larger increase necessary. The act would take effect 60 days after enactment.
Impact
HB950 would create a new section in Pennsylvania insurance law specifically regulating long-term care insurance premium increases. It would limit how insurers can adjust renewal rates, constrain age- and duration-based pricing changes, and give the Insurance Commissioner explicit authority to reject noncompliant or excessive increases. The bill would directly affect long-term care insurers, policyholders, and the Department of Insurance by establishing a clearer rate-review standard and a consumer protection cap on annual premium hikes.
Sentiment
Based on the bill text and the absence of recorded committee debate or votes, the measure appears to be framed as a consumer-protection bill aimed at shielding long-term care policyholders from steep or age-driven premium increases. The overall sentiment is likely favorable toward policyholders and rate stability, with the bill’s sponsors seeking to address affordability and predictability in long-term care coverage. No recorded opposition, amendments, or vote history is available in the provided materials.
Contention
The main point of contention is likely the balance between consumer protection and insurer rate flexibility. Insurers may view the 15% annual cap and the prohibition on age- or duration-based increases as too restrictive, especially if claims experience or benefit utilization rises faster than expected. The bill does include a commissioner-approved exception for larger increases tied to higher-than-expected utilization, which suggests the central debate would be whether that safeguard is sufficient to preserve insurer solvency while protecting policyholders from sharp premium hikes.
In casualty insurance, further providing for conditions subject to which policies are to be issued and for health insurance coverage for certain children of insured parents.