Early CalPERS Long-Term Care clients squeezed by rate hikes
Two impending hikes that would boost premiums for existing CalPERS Long-Term Care insurance customers by 90% make coverage hard to justify, one policyholder said.
May 27, 2021
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Financial adviser Lawrence Grossman is holding onto a long-term care insurance policy he started 20 years ago, even though his premiums are five times what they originally were.
But that might not be the case for much longer. With two impending rate hikes that will increase premiums for existing CalPERS Long-Term Care insurance customers by 90%, the cost will be hard to justify, Grossman said.
That wasn’t supposed to happen, he said. Two decades ago, California’s then-young program offered competitive rates that were marketed as intended to stay low over time. After rate increases in 2013, some participants sued CalPERS, claiming that the program broke a promise not to increase rates, leading to a consolidated class-action lawsuit that is set to go to trial in November.