Contributor ⭐⭐

Long-term care insurance: concerns about viability of AARP-recommended Genworth Insurance company

Forum|Forum|9 years ago
April 1, 2017
32 replies
34859 views

About five years ago, I bought Genworth long-term care insurance based on AARP's affiliation with Genworth. Concerns about the company's viability are now great: there is a class-action lawsuit against them (2016), it was sold to a Chinese company, and one can read about dismal responses to filed claims. I tried to contact someone in AARP to see if AARP had any recommendations about what policy holders can do (as of about a year ago, New York Life became AARP's long-term care insurance associate). I've not had a response to the question: does AARP have a recommedation regarding Genworth, and, if so, what is it? Does anyone have suggestions for what to do about Genworth? Does anyone have a suggestion as to whom to contact in AARP for some advice in this matter? Thank you.

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s59712o

Contributor ⭐

The class action lawsuit you mention has nothing to do with Genworth paying claims properly. The class action suit was brought by stockholders who say Genworth did not properly disclose their claims projections.

Genworth pays more claims than any other LTC insurance company. In 2015, Genworth incurred over $1.5 BILLION in claims. That was almost twice as much as any other company.

The hard part about filing a long-term care insurance claim is that it’s something you only do ONCE in your lifetime. Most doctors don’t know what’s required to file a claim. Each state has laws that require the insurance companies to make a claims decision quickly (usually within 60 days of receiving the claim form). If the insurance company has not received the medical records and the certification from your doctor within that time period the insurance company has to deny the claim. You then have to re-open it, which is a real pain.

The best thing to do at the time of claim is to work with a home care agency that has a lot of experience filing long-term care insurance claims. Amada Senior Care is one example. They’ve processed thousands of long-term care insurance claims. I don’t work for them but I know them and I recommend them to all of my clients.

http://amadaseniorcare.com/free-ltci-claims-processing/

Scott

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lc71896263Author

Contributor ⭐⭐

Thank you, Scott. So do you have confidence in Genworth's viability (in contrast to various reports I've read)?

GailL1

Community Champion ⭐⭐⭐

@xStork

Since any affiliation between AARP and Genworth LTC ended years ago, the best you can hope for is that the company stays solvent to pay any claims you or your wife may have in the future. They are suppose to have a reserve set up at the state level to back up their claims since the company is not on financially solid ground anymore. Or your policy could be transferred to another insurer. Anyway, as long as you continue to make your premium payment, there is coverage. However, you might want to check with your state’s guaranteed association to see what would happen; there is a limit as to how much a policy would pay out if under the state’s guaranteed program.

Now AARP has an affiliation with NY Life for LTC insurance and rthe policies have been reconfigured with life insurance.

LTC insurance is definitely a hard one for insurance companies to stay on top of - what was the cost of these types of services back in 2015 has definitely escalated -

You should still have some good value in your policy since you have had it for so long but that does not mean that premiums are not gonna continue to increase or you make the decision to lower the benefits -

Just understand your policy so that you know when you can file a claim if needed. Documenting the level need for services of daily living isn’t always easy but it just depends on the specific conditions. Know your policy.

What is the ole saying, the only people that need a LTC policy are the ones in-between a poverty level since that is covered by MEDICAID and being rich so that one can self -pay when needed. Otherwise, if you do not have one, then you have to self pay or participate in a spend-down until assets are all used up.

I agree with @CBtoo - a decision to have any sort of benefit is based on numbers and not affiliation - affiliation in this regards only means that AARP is selling their name brand for a royalty price.

IT‘S ALWAYS SOMETHING . . . . .. . . . Roseanne Roseannadanna

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jimluebker

Contributor ⭐

I have had Genworth LTC for years. Had a 14% increase in 2013. Just recieved notice of a 42% increase. A $2000+ per year increase. May force me to drop out thus bacicaly losing coverage and the nearly $32000 i have put in. Not a happy senior!

GailL1

Community Champion ⭐⭐⭐

@jimluebker wrote:
I have had Genworth LTC for years. Had a 14% increase in 2013. Just recieved notice of a 42% increase. A $2000+ per year increase. May force me to drop out thus bacicaly losing coverage and the nearly $32000 i have put in. Not a happy senior!

Do you have the option of dropping down your benefit level to save premiums cost on this policy - that might be better than nothing at all.

Personally, I like the saving and investing for growth idea on a personal level because remember, LTC insurance is insurance which means what you pay in premiums helps those who are receiving the benefit now and cost can only go up in the future because it is labor intensive.

Home Care, a personal care home or assisted living is gonna be cheaper than actual longterm care in a nursing home and your policy should cover personal care for those areas needed and covered by your plan in wharever environment.

IT‘S ALWAYS SOMETHING . . . . .. . . . Roseanne Roseannadanna

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VictorB61677

Contributor ⭐

You don't get it. This CEO is on a personal campaign to drive up rstes on its long term care insurance to drive policy holders out of the coverage. Why else would a company that at the time of the offering in 2003 claimed that they had never raised rates since beginning policy issue in 1974 would increase my premium in the last three years almost 100%. This is not the action of a responsible company. This is the action of a sort that is criminal and needs to be attacked. If this CEO and company doesn't face a class action suit, I don't know who should be. I am waiting for someone to tell me how to file. I'd pay money to go after this outfit. Genworth Long Term Care is the coimpany.

Victor Battagliol, Policy holder since 2003

M

ms8605402

Contributor ⭐

If Genworth pays out more claims than any other LTC insurer, then they most likely have collected more money in premiums over the years than any other company. My wife and I just received a notice of a 45% increase in premiums. We, like many seniors are on a fixed income and I'm sure Genworth understands this. I don't think AARP should recommend a company that takes such advantage of retired Americans.

GailL1

Community Champion ⭐⭐⭐

@ms8605402 wrote:
If Genworth pays out more claims than any other LTC insurer, then they most likely have collected more money in premiums over the years than any other company. My wife and I just received a notice of a 45% increase in premiums. We, like many seniors are on a fixed income and I'm sure Genworth understands this. I don't think AARP should recommend a company that takes such advantage of retired Americans.

Genworth LTC and AARP severed their MARKETING AGREEMENT back in 2013.

You have a decision to make -

Many policies let you reduce the benefit to keep premiums in line with a tighting budget. At least this keeps you from losing it all together if you let it lapse for non-payment of premiums. Beginning again at a higher age with a new policy probably isn't an option.

I don't know of any insurance that is based on a fluctuating marketplace that does not increase based on the use, cost and exposure of that marketplace auto, home, health and yes, LTC. As with other insurance, premium cost are determined by risk factors and the cost of LTC is escalating - salaries, benefits, employer cost for employees - payroll tax match, workman's comp, unemployment insurance - and other cost associated with the care services and yes, profit of the provider too -

Also consider the "long" part of the equation in this type of insurance - we are living longer and when these benefits begin to pay out, they are rarely ever stopped in the short term and premiums still have to be paid.

LTC insurance needs to be re-evaluated periodically because financial conditions change. LTC insurance is mainly for those in the middle - income and assets. The rich could probably pay out of pocket for their care, the poor can rely on Mediciad, if long term care enters the picture - LTC insurance is for those in the middle who want to preserve some of their assets - that's the reason for all insurance - FINANCIAL PROTECTION.

AARP uses these marketing agreements with other companies and the financial benefits they derive from them to further their mission statement as a non-profit. Each member should still evaluate the product to make sure the product is good for themselves; the best product for themselves.

So so look at your situation, evaluate the policy, the coverage, any options you may have and determine the BEST decision you can make for your own situation.

IT‘S ALWAYS SOMETHING . . . . .. . . . Roseanne Roseannadanna

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VictorB61677

Contributor ⭐

I Am a Genworth policy holder since 2003. I was brought into the product by my financial advisor based on GE advertising that since 1974 GE had not ever raised rates on its Long Term Care Insurance and that while that was a possibility how could one imagine that in 3-4 years my policy rates would almost double. I don't see how AARP can justify defending a company that would do that, especially to people who are way beyond the ability to pay such and increase.

This should be the subject of a major class action suit against this company and AARP should support it. The action of the CEO in this case is unconscionable. Trying to unload this company now after claiming to be the biggest and most profitable for years and then saying he

s going to dump it is criminal.

J

jimluebker

Contributor ⭐

Wife and I took out LTC with Genworth in 2012. Yes it was expensive, but thought it was best to thing to do to insure that our children would not have to be burdened. We were told that premiums rarley increase and so we looked in depth at our expenses and income going into the future and felt comfortable. Premiums were $3900 the first two years but went up about $500 the 3 year. While that concerend us we still felt ok. Then the bomb dropped in late October 2018. A $2000 increase hit us in the face. We didn't know what to do. Around $45000 invested and now the choice. Loose all that "investment" and go without or pay up. I called our state insuranse commisoner, no help, called Genworth absolutley no help. My agent finnaly got us a "deal" thru GEN. Cut back from 8 years of coverage to 5 years and instead of the 5% added to our yearly premiums now it would be 3%.and payments would $4600. Now I here of more increases.

Shame on you GEN and as far as AARP your endorsement of GEN just added on to other reasons for mer not to renew my subscription!

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lc71896263Author

Contributor ⭐⭐

Thanks to you and to all others who have replied to my original question. I'm very concerned about Genworth and whether it will be there when I and others need it and about the fact that it has not been there for so many. I tried to contact the AARP to ask if it had a recommendation about what to do--especially because the AARP offered LTC insurance through Genworth. The AARP rep on the phone kept telling me to call Genworth, even after I explained that I was looking to speak with someone at AARP. The rep was not trained to answer this type of question. In any event, has anyone tried to bring this to the attention of AARP's leadership? If so, what was the result?

It seems that, if AARP's mission is to help older folks, the Genworth situation in particular and the LTC situation generally is something AARP would want to address. Thoughts? Thanks!

GailL1

Community Champion ⭐⭐⭐

@lc71896263

AARP is NOT an insurance company or even a co-insurer - they are a membership organization that SELLS their (branded) name to get royalty income for revenues to support their whole mission including their Foundation.

These type of arrangements are done by the AARP taxable entity of AARP Services, Inc.

AARP .org is a nonprofit, nonpartisan membership organization that empowers people to choose how they live as they age (their mission) AARP.org - Who We Are - About AARP

The AARP Services, Inc. (ASI) is the division that sells the AARP branded name to private companies of various types for this royalty income - ASI is a taxable entity. AARP Services, Inc (ASI)

Perhaps that is where you should address your grips but I doubt anything will come of it.

AARP really does not "recommend" any of the various companies that are paying this royalty income and thus bares the AARP name. Again, read the small print and the disclaimers of the private entity product or service.

Perhaps in the minds of some, they interpret this service branding as a recommendation - it is not. Various types of Insurance are based on the needs of the person buying the policy. in fact, many times there isn't even any AARP special deals, especially with many of the insurance products.

Many times, the branded service can be sold to everybody - not just members. The only branded service which I know about in the insurance realm where you have to be a member to buy the policy is with AARP UHC Medicare Supplemental (Medigap ) Insurance and that is because it is written as a "GROUP" type insurance product with each member being covered under the group policy for this Medicare GAP coverage - the same for everybody depending upon which alphabet plan a member picks as their choice.

The AARP branded Long Term Care insurer is now New York Life. The AARP name branding agreement (and that is all that it was) with Genworth ended many years ago.

Genworth, in regards to solvency issues, is, as any other insurer of this type of coverage, is under rules by the Feds and the various states where they sold these types of policies. As I said before, the office of the insurance commissioner in the state where you live maybe a better entity to advise you on the financial health of the insurer - Genworth. They would have the latest financials. You can always check Genworth's rating on AMBest too.

Better yet, with helping you determine what to do, consult a local long term care insurance agent - preferably one that sells Genworth.

Investopedia - What If Your Long term Insurance Carrier Goes Bust

This describes the protections which you have.

Again, hopefully, there are some changes which you can make to your policy to make the premiums more reasonable to you - this, would, of course, lower your benefits too. Perhaps a Genworth agent could make some recommendations.

IT‘S ALWAYS SOMETHING . . . . .. . . . Roseanne Roseannadanna

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lc71896263Author

Contributor ⭐⭐

Thank you so much for your comprehensive response. It's much appreciated. I will definitely take some of the steps you have outlined. As far as AARP is concerned, as we know, when AARP associates its brand with a particular product, it gives the impression to the general public, and especially the older public, that AARP is endorsing that product, small print and nonprofit/for-profit status to the contrary notwithstanding. If it is not endorsing the product, it should say so loud and clear and upfront--otherwise it's being deceptive. Moreover, if that product begins to adversely affect older people (as Genworth and LTC insurance generally may be doing), then AARP should step up to the plate and offer some suggestions for measures that can be taken to protect oneself from those adverse effects. It should offer on its website a way for its members to notify AARP of such effects and it should initiate the process of notifying members of such effects. I can't see that AARP does this. I can imagine that most readers of this post will agree with me--AARP representatives probably don't read these discussions ( at least, not in a meaningful way), so I also imagine I'm preaching to the choir. In any event, I just put all this out there in case it results in some organized effort for corrective action. Thank you again.

R

RichardC37614

Contributor ⭐

I also used AARP's recommendation to buy long term health care (LTC) from Genworth. I just got a request to increase my premium by about 10% for the same coverage??? This seems illegal to me and I called the (888)687-2277 number of AARP and was told they no longer deal with Genworth because Genworth dropped LTC and are not accepting new members.

I pointed out that there is a bunch of us with LTC from Genworth that are now stranded without AARP backing. And, I suggested that AARP has some responsibility to us even though AARP not longer uses Genworth for LTC. The person on the call didn't know anything about this and I didn't think it would go any further internally based on my call.

So, here we are left at the mercies of Genworth.

I did come up with one suggestion. That is for AARP to have one of its lawyers examine the text of a typical LTC contract and see if Genworth can legally increase its premiums unilaterally. It it is illegal, then I think AARP should initiate a class action suit for all of us in this boat. AARP would do well from there share of the resolution whether from negotiation or court action.

I think AARP has some responsibility to cover our backs in this case.

Richard Caputo

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lc71896263Author

Contributor ⭐⭐

I like your suggestion, Richard. The question is, how to get it to the right person. I tried asking AARP phone reps--very politely. I explained and I asked what AARP does when an AARP recommended company does not maintain the quality of its programs or when a member has questions about the company's current status with AARP. The rep on the phone hung up on me. I'll bet this was a very young or inexperienced person with no significant training by AARP. So--the question is, how to find the right person to talk with.

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