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) --



recent exit from the long-term care insurance market and recent rate hikes by insurers could prompt more insurers to drop the products.

"Each company is looking at their array of products. It is certainly not a surprise given where rates are," said Gregory Gaskel, managing director of North American insurance at

Standard & Poor's

. "I think it is possible

that other insurers might exit the market."

One example is Blue Cross and Blue Shield of Alabama's discontinuation of long-term care policy sales last week.

Low insurance rates, combined with changes in healthcare and longer life spans, has made the products both necessary and extremely hard to underwrite.

"A lot of people are living into Alzheimer events and other mental impairment-type illnesses and this is where a lot of insurance companies are seeing claims coming from. It is extremely hard for insurers to get a handle on the pricing," explained Edward Shields, associate director at Sandler O'Neill.

Shields added that some companies that sell group long term care insurance such as



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are able to get terms that they want, but overall long term care rates are increasing. Both




John Hancock


are considering raising rates by 40 percent. Genworth, meanwhile, is considering raising plans rates by 18%, according to published reports.



. ,

State Farm


Northwestern Mutual


New York Life

also sell long term care insurance.

--Written by Maria Woehr in New York.

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