LTC Insolvency Hitting Policyholders Hard

Cal Broker contributor Bonnie Burns from California Health Advocates sent us the following info. We think it’s worth passing along…

In March of 2017 a long-term care insurance company was declared insolvent.  The company, PennTreaty Network America (PTNA) and its subsidiary company, American Network Insurance Company (ANIC) were subsequently declared insolvent and are now administered by each state’s Guaranty Association.  The reserves and assets of the two companies are woefully insufficient to pay the benefits promised to their policyholders; and far too deep to fill by the imposition of any reasonable amount of premium increases.

State guaranty associations are responsible for keeping long-term care coverage in force when a company becomes insolvent. They do this by collecting premiums, and paying claims up to each state’s cap on benefits.  State guaranty associations also have the right to seek significant premium increases, which most states have granted. In addition, the guaranty associations can assess insurance companies doing business in a state for the cost of an insolvency; and under state law, insurance companies are allowed to pass that cost along to their policyholders.

State guaranty associations charge an assessment to the other insurance companies doing business in a state for the cost of their competitor’s insolvency. This cost includes the administration of the insolvency and the difference between a company’s reserves and the costs of their claims.  Each company’s assessment is calculated based on the amount of premium collected in a state.

PennTreaty/American Network policyholders living in California were notified of the premium increase imposed on their coverage and given options to lower that increase by reducing their benefits.  The amount of benefits a policyholder can collect in California is $554,556; certainly less than the amount of lifetime coverage some people purchased. At the same time, most other companies that sold long-term care insurance have also been notifying their policyholders of sizable premium increases and similar options to reduce coverage.

Recently CNA Insurance Company has begun notifying its policyholders that as a result of the insolvency of PTNA/ANIC, CNA was passing on the assessment imposed by the California Guaranty Association to their policyholders in the form of a surcharge. This surcharge is in addition to any prior or any future premium increase. It is unclear if this is a one-time surcharge, or one that will be imposed annually. It is likely that other companies will follow suit and that policyholders with other insurance companies will be notified shortly of an increase in their premiums based on this assessment methodology.

In addition to some recent jaw dropping premium increases for long-term care insurance, the necessity of giving up previously purchased benefits to reduce that premium increase, having their lifetime benefits capped, and now paying a insolvency surcharge imposed by their insurer, policyholders are financing much more than the cost of the original benefits they  bought to pay for their care in later life.

California policyholders with questions about their options can contact their local Health Insurance Counseling and Advocacy Program (HICAP) at 1-800-434-0222. HICAP provides free, individual and unbiased assistance and information on Medicare and other health insurance related questions such as long-term care insurance.

Also don’t miss this Los Angeles Times story about the LTC problem.


The Leadership Development Group, has a great post up about the power of gratitude. Here are a few ways they say you can foster gratitude:

  1. Keep a daily gratitude journal.
    Note the contributions people have made in your life, no matter how small.
  2. Give specific, meaningful, and heartfelt praise.
    Praising good work motivates high levels of performance.
  3. Personalize your appreciation to your employees.
    Whether a shout-out at a meeting or telling the person directly, the effort you put into showing your appreciation demonstrates that contributions are meaningful

TLD Group dedicated the post to Kaiser’s Bernard Tyson, who recently passed away. It’s worth the trip to go on over and read the whole post


Medicare Supplement Agents: Oxford Life Eases Underwriting with InstaWrite

Oxford Life® Insurance Company’s InstaWriteSM process is now available for the underwriting of Medicare supplement policies. This feature eliminates the interview step that was previously required for these sales. Oxford says InstaWrite is a better experience for agents and clients, improving upon the traditional Medicare supplement sales process by offering an almost instant health assessment. Since InstaWrite is an electronic process, agents can perform the underwriting on a laptop computer, tablet or smartphone from a client’s residence without involving anyone else.Go to to sign in as an agent, access the “tools” tab and use the InstaWrite feature.

SCAN Offers Immersive Experience to Put Audiences in the Shoes of Aging Adults

SCAN Health Plan® has launched Trading Ages Virtual Reality (TAVR), the evolution of the organization’s successful Trading Ages senior sensitivity training program. The insurer is tapping expertise honed over more than 40 years of helping seniors and leveraging advanced virtual reality technology to bring to light the unique physical and emotional challenges of growing old. Those who experience the TAVR are immersed in a combination of visual effects, 360-degree audio and ingenuity to navigate everyday activities while physical and emotional impacts are simulated. The user is guided through a series of scenarios that mirror what it is like to live with hearing loss, macular degeneration and even what it is like to be a caregiver of a loved one with dementia. These mock encounters are incorporated into the larger educational session that is delivered in a group setting, giving participants a real sense of the physical, social and emotional aspects of aging. Built upon the success of the original version of Trading Ages, SCAN has taken the program to the next level and taps the immersive power of virtual reality so program participants may experience more realistic scenarios that replicate some of the daily obstacles associated with aging. Significantly enhancing the efficacy of the program, TAVR brings to life the challenges that older Americans face every day. This program aims to pioneer a new era of sensitivity training, offering fresh insights and perspectives to individuals, businesses, organizations and government entities—anyone who interacts with seniors regularly.


California Broker is Hiring!

Need a flexible sales gig working remotely with some really cool people? If you’re a self-starter who knows insurance and wants to sell advertisements, please email a note highlighting your experience and enthusiasm to:

The Guardian Life Insurance Company of America Names Andrew McMahon President

The Guardian Life Insurance Company of America announced that Andrew McMahon, an industry veteran and head of the company’s largest business, has been elected President by its Board of Directors. Mr. McMahon’s appointment is part of Guardian’s regular succession planning process and is effective January 1, 2020.  He will continue to report to Guardian Chief Executive Officer Deanna Mulligan as he directly oversees Guardian’s lines of business.


Apply Now to Make Your Great Idea a Reality!

Got some great tech ideas based on the insurance agent/broker experience? BrokerTech Ventures, a consortium of insurance industry companies, wants to hear from you. Propose your idea and, if your proposal is selected, you’ll be a part of a small group of entrepreneurs who will receive money and mentorship to help get that idea off the ground. BrokerTech will select seven to 10 proposals for a $50k convertible note and mentoring. Early stage ideas are welcome. The submission window is open until Nov. 29. Read more about it in the Des Moines Register. Find BrokerTech on Twitter @BrokerTechVen or on LinkedIn @BrokerTech-Ventures. Email questions to Or visit the website


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    April 22, Skirball Center, Los Angeles. More info soon!



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