MetLife said Thursday that it will no longer offer long-term-care insurance, the coverage that people buy to pay for nursing-home stays or assisted living in the latter part of life. The company will still honor the obligations it has to existing customers, but it will not take new customers after Dec. 30.
People have typically paid for long stays in a nursing home or assisted-living facility by taking out a reverse mortgage or by buying long-term-care insurance. The insurers have had more customers cashing in on their long-term-care policies and, at the same time, the cost of providing care is rising.
As a result, several insurers have increased premiums for next year by about 40 percent compared with this year’s rates. As an alternative way to pay for nursing-home or at-home care, The Hartford Financial Services Group recently started offering a rider on permanent life insurance policies that allows a person to draw down on the cash that would be paid when a policyholder dies. That money, freed up in much the same way as a reverse home mortgage, can be used to pay for any number of care expenses if the policyholder has a chronic illness or cognitive impairment.
“MetLife remains committed to our current [long-term-care insurance] policyholders and certificate holders and will continue to ensure that they receive quality service, particularly when needed most — at time of claim,” said Jodi Anatole, vice president of long-term-care products for MetLife. “While this is a difficult decision, the financial challenges facing the [long-term-care insurance] industry in the current environment are well known,” Anatole said. MetLife employs about 2,000 in a Bloomfield office, although company officials could not say Thursday how the change will affect operations there.
By MATTHEW STURDEVANT, firstname.lastname@example.org
6:37 PM EST, November 11, 2010