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Truth Behind the End of Unum’s Long-Term Care Contracts
July 30, 2012
As of Feb. 7, 2012, Unum Insurance Company ended sales of a group of long-term care contracts.
The move is part of an industry-wide trend to limit long-term care coverage. Both of the nation’s largest U.S. life insurance companies also halted sales of group long-term care coverage within the past two years.
Unum ‘Buyers Study’
Unum terminated long-term coverage after conducting a Buyers’ Study that concluded 57% of people who file long-term care claims are under age 65. Since the company equates “long-term” with coverage for the elderly, it decided to end sales of long-term coverage. Existing policy holders will, however, continue to be eligible to receive long-term benefits, according to a Unum press release.
A Tough Fight
Winning long-term benefits has always been a challenge, because the law doesn’t clearly define what makes a person unable to work. Consequently companies like Unum design long-term disability policies to be as restrictive as possible.
But now, the fight is even tougher. In fact, it’s nearly impossible to win long-term benefits without a qualified, aggressive attorney to help you.
Real Reason Companies are Ending Long-Term Coverage
According to a recent Bloomberg News article, the real reason Unum and other insurance companies are halting sales of long-term care policies is low interest rates. This proves, once again, that the bottom line for UNUM is profit, not what may be best for their customers.
“Low interest rates limit investment on [long-term disability] funds set aside to cover claims that may not arise for decades,” Bloomberg reported.
Interest rates in the United States are expected to stay low through at least 2014.
Termination Despite Sneaky Rate Increases
Unum’s termination of long-term coverage comes despite a 12.8% rate increase earlier this year.
Further, Unum miscalculated long-term care coverage when it originally designed its long-term policies. The company failed to foresee two important developments: fluctuating interest rates and longer lifetimes.
Let Us Help You Determine Your Legal Options
You shouldn’t have to suffer as a result of Unum’s greed and lack of foresight. If Unum has denied you long-term disability benefits, contact us so we can help you recover the benefits you deserve. Time is limited to file an appeal, but if you call us or fill out the form on the left, we can determine your legal options. There is no upfront charge for any work we do—we only receive remuneration when you do. Call now for our free case evaluation.