Substitute Senate Bill No. 1269 aims to enhance regulations surrounding long-term care (LTC) insurance and provide financial incentives for policyholders. The bill mandates the Insurance Department to submit a report by February 1, 2026, evaluating alternative pools for LTC policyholders with policies exceeding twenty years and the premium rate filing processes. Key provisions include the introduction of new definitions for LTC riders attached to life insurance and annuity contracts, requiring life insurance companies to provide written disclosures about costs, benefits, and conditions. The bill also establishes a tax credit of 20% on premiums paid for LTC policies for eligible taxpayers, effective for taxable years starting January 1, 2026.

Significant changes in the bill include the repeal of existing statutes, such as section 38a-475a, and the introduction of a minimum loss ratio requirement of 60% for individual LTC policies. It restricts premium rate increases to a maximum of 10% without specific conditions, ensuring policyholders are notified and given options to reduce benefits. The bill also mandates that LTC policies issued after July 1, 2008, must offer a nonforfeiture benefit option and requires insurance companies to disclose potential future premium rate increases at the time of policy delivery. Overall, these amendments aim to improve consumer protection, transparency, and accessibility in the long-term care insurance market.

Statutes affected:
Raised Bill:
INS Joint Favorable Substitute:
File No. 283: