Seniors feeling ripped off by long-term care insurance

A growing number of seniors who have bought in to long-term care insurance are complaining about increasing rates and decreasing coverage. More than 7 million people have bought in to the plans, which

News 12 Staff

Jan 23, 2009, 4:40 AM

Updated 5,656 days ago

Share:

A growing number of seniors who have bought in to long-term care insurance are complaining about increasing rates and decreasing coverage.
More than 7 million people have bought in to the plans, which are designed to provide care to people beyond a predetermined time. The plans are largely provided for elderly people who can no longer perform basic life activities but aren't necessarily ill.
Claude Assini says he bought a plan seven years ago from Genworth Financial because he didn't want to be a burden to family in his golden years. His rates were raised by 11 percent recently, and Assini had to discontinue his plan and lost $30,000 for his seven years of premiums.
He feels the company purposely raised rates so it could cash in when plans were canceled.
"It's really a fraud perpetrated on a lot of old people who really wanted to do the right thing," says Assini. "They'll continue to up the rates until everybody drops out, and they'll make a great profit because they don't have to pay anything."
Marilyn Askin, of the AARP, explains the jacked up rates by saying the plans have been sold for too long for too cheap.
"Long term care insurance would appear to be even a riskier investment that the stock market," she says. "These are folks who were really slapped in the face because they're folks who thought they were doing the right thing."
Genworth says the rate hikes were necessary to meet policy holders' needs. The company also claims the adjustment was approved by the New Jersey Department of Banking and Insurance. The department disputes that claim, pointing out the policy was technically issued in Alabama and saying New Jersey doesn't have a say.
The answers are equally aggravating to Assini.
"Why did you allow it to be sold in New Jersey if you don't have regulatory power over it?" he says.
Askin maintains long-term care plans may still be the right choice for families, and recommends the plan to families with histories of Parkinson's or Alzheimer's.
Claude Assini doesn't recommend them to anyone, however.


More from News 12
2:25
A massive tech outage is causing worldwide disruptions. Here's what we know

A massive tech outage is causing worldwide disruptions. Here's what we know

2:30
Global technology outage causing flight disruptions at Newark Liberty Int’l Airport

Global technology outage causing flight disruptions at Newark Liberty Int’l Airport

2:24
Cool temps overnight; mix of sun and clouds this weekend with chance for rain

Cool temps overnight; mix of sun and clouds this weekend with chance for rain

0:28
Prosecutor: Infant girl dies after being left inside parked car in East Hanover

Prosecutor: Infant girl dies after being left inside parked car in East Hanover

0:53
Beachwood West Beach closed for rest of summer due to high bacteria levels

Beachwood West Beach closed for rest of summer due to high bacteria levels

What happens if Biden drops out of the race? Here are some scenarios

What happens if Biden drops out of the race? Here are some scenarios

0:26
Costco sells ‘emergency food supply’ bucket with a 25-year shelf life

Costco sells ‘emergency food supply’ bucket with a 25-year shelf life

5:00
Tech expert weighs in on Microsoft outage impacts across the globe

Tech expert weighs in on Microsoft outage impacts across the globe

0:31
Man dies after he rescues two young boys who were struggling to stay afloat in New Jersey river

Man dies after he rescues two young boys who were struggling to stay afloat in New Jersey river

2:14
Property taxes increase in some New Jersey towns as state slashes school funding

Property taxes increase in some New Jersey towns as state slashes school funding

0:26
Russia convicts reporter from NJ of espionage after a trial widely seen as politically motivated

Russia convicts reporter from NJ of espionage after a trial widely seen as politically motivated

0:26
Loose lid blamed in latest Dunkin’ lawsuit from Elizabeth woman

Loose lid blamed in latest Dunkin’ lawsuit from Elizabeth woman

2:20
Paws & Pals: Prince now available for adoption with Best Friend

Paws & Pals: Prince now available for adoption with Best Friend

0:36
Police: Borgata Hotel briefly evacuated after caller claims to have bomb

Police: Borgata Hotel briefly evacuated after caller claims to have bomb

13:51
'I’m not supposed to be here tonight.' Donald Trump recounts assassination attempt

'I’m not supposed to be here tonight.' Donald Trump recounts assassination attempt

1:39
New Jersey environmental justice law won't block power plant hotly fought by Newark residents

New Jersey environmental justice law won't block power plant hotly fought by Newark residents

1:57
Prosecutor: Director of Brick Township Rec Department issued phony permits to play on ballfields

Prosecutor: Director of Brick Township Rec Department issued phony permits to play on ballfields

1:53
Hundreds of Hunterdon and Somerset county residents clean up following intense Tuesday storms

Hundreds of Hunterdon and Somerset county residents clean up following intense Tuesday storms

0:44
Jersey Proud: Union Township elementary school students participate in junior police academy

Jersey Proud: Union Township elementary school students participate in junior police academy