Prudential LTCi News: (CT, MA, SC) LTC3 Refreshed Rates Effective February 9, 2012

(CT, MA, SC) LTC3 Refreshed Rates Effective February 9, 2012

Prudential Long-Term Care previously announced that we are in the process of filing “refreshed” LTC3SM premium rates with the state Departments of Insurance and that once we receive approvals, we would provide notice before implementing the new rates. Accordingly, refreshed LTC3 rates will go into effect and new LTC3 product features will be available in the states of Connecticut, Massachusetts and South Carolina, on Thursday, February 9, 2012.

Applications received from Connecticut, Massachusetts and South Carolina on or before Wednesday, February 8, 2012, will be eligible to receive the existing LTC3 rates. Applications received Thursday, February 9, 2012, or later for Connecticut, Massachusetts and South Carolina will be issued with the new rates.

ESP and Affiliation Guidelines

In accordance with our standard Employer Sponsored Program (ESP) guidelines, cases approved for Connecticut, Massachusetts and South Carolina prior to Thursday, February 9, 2012, will be permitted to use the current LTC3 rates and benefits for 60 days beginning on the open enrollment start date. For applications received outside of the open enrollment period, the refreshed LTC3 rates will be in effect.

Affiliation cases approved prior to Thursday, February 9, 2012, will have no more than 60 days from the date of the Affiliation approval to use the current LTC3 rates and benefits. For applications received outside of the 60 days, the refreshed LTC3 rates will be in effect. 

Exceptions to Issuing with Current Rates

Please note that submitting an application by the cut-off date does not necessarily mean that the old rates will apply. Any of the following situations will exclude the application from using the old rates even if the application is received by the cut-off date:

Application is submitted from an agent not yet appointed with Prudential or who is in a pre-appointment state, or if the concurrent filing timeframe is missed due to a delay on the part of the General Agent (GA) or agent

Application is submitted by an agent who is not Partnership of CE compliant

If a new application is necessary for any of the above reasons, the new signature date for rates will apply.

(CT) Loyalty Discount Now Available with Partnership

We are pleased to announce that the 5% Loyalty Discount is now available with Partnership in Connecticut with LTC refreshed rates. 

New LTC3 Product Features

We are also pleased to introduce the following new LTC inflation options in Connecticut, Massachusetts, and South Carolina and in other states where available:

2% Automatic Compound Inflation Option

4% Automatic Compound Inflation Option

Available Inflation Options By State

Current LTC3 policyholders in a refreshed-rate state may change their inflation benefits to any of the above inflation options if available. However, this would require a lapse and rewrite of their current policy with underwriting at attained age.

State Variations

Connecticut: Please note for Connecticut Partnership, the 5% Automatic Compound Inflation – No Max – is required. Also, Connecticut does not allow 5% Automatic Compound – 2X Max option not does it allow the following Elimination Periods: 120, 180, 365.

Massachusetts: Please note the one-year benefit period is not available in Massachusetts.

* Also note that MA is not yet a participant of the National Partnership Program.

Discontinuance of Certain Optional Riders and Features of LTC3 Effective April 5, 2011

As previously announced, the following LTC benefits and features have been discontinued in all states effective April 5, 2011:

Unlimited Cash Benefit Rider and Flexible Cash (50/50) Benefit Rider

Unlimited/Lifetime Benefit Option

150% HHC Option incompatible with 10-year Benefit Period and with simplified underwriting for Employer-Sponsored Program (ESP) multi-life cases

Benefit Increases on In-Force Policies

For those whose policies already include any of the above features and benefits, there is no change to the existing policy. However, to be consistent with our discontinuance of marketing these benefits and features, we will not allow any benefit increases on policies that have any of the discontinued features or benefits. The exception is for policies that have the GPO inflation option, in which case a once-per-lifetime upgrade to an automatic inflation option will be allowed.

Refreshed LTC3 Rates are currently in effect in the following states:

Alabama, Alaska, Arizona, Arkansas, District of Columbia, Delaware, Georgia, Idaho, Illinois, Iowa, Kentucky, Louisiana, Maine, Michigan, Minnesota, Mississippi, Montana, Nebraska, New Hampshire, New Jersey, New Mexico, New York, North Dakota, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Dakota, Tennessee, Utah, Vermont, West Virginia, Wisconsin and Wyoming

Illustration Software

A new illustration software package entitled LTC3 Revised Rates, which is separate from our LTC illustration software application, contains the new rates and the new features for all previously announced “rate-refreshed” states. Prior to February 9, 2012, the software will reflect the refreshed rates and new features where available. It will be updated to version 1.12.0. Please note that the refreshed rates should update automatically but in some instances, it may be necessary to “Reset states to software defaults.” This option can be found in Individual section of the Help menu.

For states that have not yet experienced refreshed rates, the existing software, entitled LTC3, can still be used. A pop-up window in each illustration software application alerts you to the correct version for a particular state. Once the revised rates become effective in a particular state, you will no longer find it in the original LTC3 software.

Refreshed Premium Averages (Connecticut)

The refreshed LTC3 premium rates, which vary by issue age, on average will be as follows:

5% Compound No Max*: Range 20% – 71%: Avg. 47%

3% Compound: Range 7% – 29%: Avg. 17%

5% Simple: Range 10% – 33%: Avg. 22%

GPO and No Inflation: 5%

Refreshed Premium Rate Averages (All Other States)

The refreshed LTC3 premium rates, which vary by issue age, on average will be as follows:

5% Compound No Max*: Range 14% – 63%: Avg. 40%

5% Compound 2x: Range 14% – 34%: Avg. 22%

3% Compound: Range 2% – 23%: Avg. 11%

5% Simple: Range 5% – 27%: Avg. 16%

GPO and No Inflation: No Change

Click here for the “Unbeatable Combination” flier.

Click here for the State Variation Chart.

Click below to view previous issues of LTCi News.

November 3
November 17
November 23
December 2 
December 8
December 15
January 5
January 12