John Hancock has announced the discontinuation of the sale of its California Partnership Long Term Care Insurance product, effective Monday, September 16.

Strict Regulations and Low Sales in California

The company described the move as a “difficult decision” based on “continued low sales volume” and their findings “that the strategic direction of our LTC products and markets no longer synchronizes with California Partnership regulatory requirements”.

Current policyholders of California Partnership plans will not be affected by the changes, and already existing plans remain guaranteed renewable. However, the company did note that premium rates can be raised based on regulatory approval. All applications for California Partnership LTCI policies must be signed by September 16 and received by September 23 to be considered for approval.

While John Hancock Partnership products will no longer be sold in California, the insurance company will continue to market and sell their non-Partnership product Custom Care III across the state.

Partnership Program Approved in Three States

As the company closes up shop for Partnership plans in the Golden State, they are beginning sales of Partnership Long Term Care Insurance products in 3 new states.

John Hancock launched Partnership Long Term Care Insurance programs in Missouri, Ohio, and West Virginia on Monday. In order to be considered for a Partnership-qualified policy in these states, the following requirements must be met:

1)    The policyholder is a resident of one of the three states when coverage becomes effective.

2)    The policy is tax-qualified and meets all applicable Deficit Reduction Act (DRA) requirements.

3)    The policy was issued on or after the following date in each applicable state:

August 28, 2007 in Missouri; September 10, 2007 in Ohio; or July 1, 2010 in West Virginia

Partnership-qualified policies must also include an age-based inflation option. New marketing materials, forms, and application booklets have all been updated on the John Hancock website for agents and consumers.

Why Choose a State Partnership Policy?

John Hancock is one of the largest providers of Long Term Care Insurance in the United States and has enrolled more than 1.3 million LTCI policyholders. Like many private LTCI carriers, they have joined forces with various states as part of the Partnership programs.

State qualified Partnership programs encourage state residents to purchase a Long Term Care Insurance policy from a private insurer, with the potential for receiving a Medicaid spend down waiver if additional LTCI benefits are necessary down the road. These plans are meant to incentivize personal responsibility and reduce the financial burden on the state stemming from long term care costs.

Rates vary widely based on state, company, age, health, and benefits desired, so be sure to work with an independent agent when looking into a Partnership qualified plan. At LTC Tree, we have agents licensed in all 50 states who have experience working with the various partnership plans in the states where they are offered. We would be happy to walk you through the different options available and provide you with a free quote.

Call us today at 1-800-800-6139 or fill out our online quote form and we will be in touch with you shortly.