Virginia Senate Bill SB828

Virginia 2023 Regular Session

• Introduced: 12/21/22
• Refer: 12/21/22

Caption

Long-term care insurance; premium rate increases.

Notes

The bill underscores the balance between consumer protection and the operational realities of insurance companies. The discussions surrounding SB828 reflect broader themes in healthcare affordability and the mechanisms through which governments can facilitate effective and equitable healthcare options for their constituents.

Impact

The implications of SB828 are significant for both insurance companies and consumers. By limiting the rate of increase on premiums, the bill seeks to provide a degree of financial predictability for individuals purchasing long-term care insurance. This is particularly pertinent for retirees and pre-retirement individuals who are often on fixed incomes and may struggle with rising costs. Consequently, the regulation intends to enhance the accessibility and affordability of long-term care insurance, aligning with the growing need for such coverage among the aging population.

Summary

SB828 aims to amend and reenact a section of the Code of Virginia concerning long-term care insurance. The bill specifies that any annual premium rate increase or premium rate schedule increase approved by the Commission must not exceed six percent of the current rate. This amendment is intended to protect consumers from significant escalations in insurance costs, thereby encouraging more individuals to maintain their long-term care policies as they age.

Contention

While supporters argue that the legislation will provide necessary consumer protections against exorbitant rate hikes, there is potential contention surrounding the impacts on insurance providers. Critics may express concerns that capping rate increases could limit the financial viability of long-term care insurance carriers, which may lead to fewer options in the marketplace. Furthermore, there could be discussions regarding the adequacy of the actuarial standards that need to be filed to ensure the sustainability of the insurance offered, as mandated by the bill.