Industry News

MetLife to discontinue the sale of Individual LTCI products

November 10, 2010 – Following an extensive review of our Long-Term Care Insurance (LTCI) business, MetLife has made the decision to discontinue the sale of our Individual LTCI products (VIP2 and MetLife LTC LifeStage AdvantageSM), including those sold through our Multi-Life Program, and our Employer Group LTCI products.

MetLife established its dedicated LTCI division close to 25 years ago with the goal of providing solutions to meet the long-term care needs of the public. We are proud that we have helped many individuals obtain quality long-term care insurance coverage while helping to protect their hard-earned assets. However, after a complete review of the LTCI products we currently have in market, we have decided to discontinue all new sales.

Our decision to cease new business sales will not impact existing insureds’ coverage.  MetLife’s LTCI coverage is guaranteed renewable. This means that as long as premiums are paid on time, coverage cannot be cancelled, although premiums for coverage can be raised on a class basis. MetLife remains committed to our existing LTCI insureds and will ensure that they continue to receive the same high level of service they have come to expect from us, especially when they need it most – at time of claim. Furthermore, as we value our relationship with you, we recognize the importance of sharing as much information with you as early as possible.

Over the years, many LTCI carriers have exited the market. Many more have had to take actions related to the pricing of their products. The challenges inherent in today’s LTCI products are not unique to MetLife. Yet the possibility of one day needing long-term care services is still a significant risk shared by many Americans. We will continue to explore potential solutions, including combining LTCI with other products, that we believe can meet both the long-term care financing needs of the public and the business goals of MetLife.

General Timeline for VIP2 and MetLife LTC LifeStage AdvantageSM Products

Individual (Non-Multi-Life Only)

After December 30, 2010, MetLife will no longer accept new business applications for Individual LTCI. Applications signed and received on or prior to December 30, 2010 will be processed as normal.

Multi-Life: New Programs

  • MetLife will continue to process any new Multi-Life Qualification Forms that are received with all necessary information on or before November 30, 2010
  • Signed Offer Letters that have been received as of November 10, 2010 will be processed normally, and we will offer a 90-day initial enrollment period for these groups
  • Signed Offer Letters that are received after November 10, 2010 but on or before December 30, 2010 will be processed; however we will only offer an enrollment period through February 8, 2011. After February 8, 2011, these groups will be closed to new entrants. December 30, 2010 is the last date that we will accept a Signed Offer Letter
  • Effective November 10, 2010, MetLife will no longer respond to Requests for Proposals (RFPs) for Multi-Life groups. In addition, all outstanding proposals/responses to RFPs are being withdrawn at this time

Multi-Life: Existing Programs

Over the next few weeks, we will be mailing letters to all active Multi-Life program sponsors informing them that their programs will be closing to new entrants. The date of program closure to new entrants will vary by group, and will be driven by the specific termination provision in each Multi-Life program sponsor’s Offer Letter. Enclosed with this release is a

sample termination letter that each Multi-Life program sponsor will be receiving informing them that their program will be closing to new entrants.

LTCI Guaranteed Purchase Option Rider (GPO)

Effective December 30, 2010, the LTCI Guaranteed Purchase Option rider on the Individual Life and Disability products will no longer be available for purchase. Insureds who are covered under a previously purchased rider will continue to have the right to exercise it, in accordance with the terms of the rider.

Employer Group Products

In September 2008, MetLife announced that we would suspend quoting on new Employer Group LTCI plans. In addition to no longer writing new Employer Group plans, today we are announcing that the plans currently in place will be closing to new entrants. Over the next few days, we will begin to communicate this decision to our Employer Group customers. We will work with Employee Benefits Sales Account Executives and Client Executives to determine the timing of each plan’s closure to new entrants in accordance with the customer’s specific policy provisions. We intend to complete closing these plans to new entrants by the end of 2011.

After extensive review, we have determined that the actual and projected experience for this block significantly deviates from original pricing. As a result, we also plan to file for an in-force rate increase on our Employer Group business. While the exact amount of the in-force rate increase that we will be requesting has not been determined, we expect it to be significant. Once the amount that we are requesting has been determined, we will be communicating it to our Employer Group customers; this is expected to be early in 2011.The amount of the actual rate increase and the timing of implementation will be subject to, amongst other considerations, regulatory approval and existing rate guarantees. We expect implementation of the in-force rate increase to begin in 2012.

More Information

Please also be assured that commissions on all in-force policies will continue to be paid out, per the terms of your contract. A FAQ document is enclosed with this release that will help answer many of the questions you may have regarding our decisions. If you have any questions regarding these communications, please feel free to reach out to Jodi Anatole, Long-Term Care Product Head.

We would like to thank all of you for your business and for your support of MetLife. MetLife continues to be a leader in the financial services industry with a wide range of insurance and other financial products and services. We look forward to continuing our partnership with you into the future.

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