John Hancock Financial, one of Colorado’s largest insurance companies, recently raised rates for long-term care coverage significantly. Some consumers saw increases as high as 90%, while other saw increases of half that number. The rate hikes have sparked the ire of consumers who say that these new rates are excessive. The state’s Department of Insurance is not being inundated with complaints concerning the matter, though regulators claim that the rates are somewhat justified.
Long-term care insurance provides coverage for those that must take advantage of nursing homes or various types of in-home care. This type of care is not typically expensive; averaging approximately $900 a year depending on the type of coverage needed. Some consumers are reporting that John Hancock has informed them that their premiums will jump to $1,700, a shock for those already struggling with costly medical bills. The premiums are only part of the problem, however, as many consumers are filing complaints claiming that the insurer is misappropriating their money.
Like other insurance companies that have raised rates in recent months, John Hancock asserts that the price hike was necessary. This is because the cost of medical care, especially in-home care, is growing at an alarming pace and insurers are losing the ability to keep up. Insurers have long held that state and federal lawmakers have to create new laws that regulate the increases in the cost of medical care for the sake of consumers. Until that happens, insurers will have to continue raising premiums in an attempt to close the gap.