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UNUM Announces 114% LTC Insurance Rate Increase!

Policyholders can eliminate the entire increase by reducing their future inflation increases.

UNUM announced its latest in-force premium increase on two of its individual LTC insurance blocks of business impacting policyholders in 21 states.

• The largest increase of 114% impacts people who have a 5% "Compound" automatic inflation increase benefit.
• People with 5% "Simple" inflation (or equal increases) face a somewhat smaller increase of 83%.
• The increase applies to policy series called "Advantage I" or Advantage Plus"
• This will be the third in-force rate increase for some older UNUM policies.
• The increase does NOT take effect until the next policy anniversary date which in many cases may be well into 2016.

Policyholders will be notified individually of their specific increase and state-approved options for reducing or eliminating the increase entirely.  Policyholder letters should begin to arrive in early November.

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North Carolina increase:

• The state of NC approved the full increase, but requires that the premium increase be spread out over three years.  In NC, if a policyholder accepts the increase, premiums will go up 31.8% a year over 3 years for policyholders with Compound Inflation, or 24.9% a year for 3 years with a Simple Inflation option.

South Carolina increase:

• SC approved a reduced increase of 20% per year for 3 years for both the Compound and Simple inflation options.
• UNUM may return to SC in the future to request the balance of the total 114% requested.
• SC policyholders who elect the reduced inflation percentage now (see below), will NOT have a new increase even if SC approves the rest of the 114% at some time in the future.

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​Inflation option to avoid the increase:

Like any LTC insurance policy, the premium can be reduced by reducing benefits, for example, changing from a "Lifetime" benefit period to 6-years, or from 6-years to 3 years; policyholders can also reduce the amount of coverage per month.
​UNUM is offering a special option with this increase:

• If you reduce your FUTURE inflation percentage from 5% to 3% (for either Compound or Simple options), then there will be NO CHANGE to your premiums related to this increase.
• All benefit increases earned to date under past 5% increases will remain in effect; the inflation rate change only impacts the increase of benefits going forward.

SCMA and our LTC insurance partner ComfortLTC recommends most policyholders should elect the reduced, 3% inflation option.

If your health is in decline and you may file a claim soon, you may want to consider accepting the full increase.
You are not affected if:

• You are on claim.
• You have a policy that is past its 10-pay, paid-up period.
• Your state has not yet approved this increase.

There are state differences (a lower approved increase percentage, or increases spread out over three years).  The states currently impacted are:
AK, AZ, CO, IA, KS, MI, NC, NJ, NV, NY, OH, OK, OR, SC, SD, TN, TX, UT, WI, WV, WY
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Call your agent; or contact us for a personalized policy review and recommendation.

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