Connecticut's House Bill 7226 aims to overhaul long-term care insurance policies, addressing rising premium costs and ensuring consumer protection. Introduced on March 14, 2025, the bill mandates that no long-term care policy can have a loss ratio below 60%, meaning insurers must pay out at least 60% of premiums in claims. This significant change seeks to prevent companies from imposing steep rate hikes without justification, a growing concern among policyholders facing financial strain.

Key provisions of the bill include stringent requirements for insurers to file and gain approval for any premium rate increases. Specifically, if a rate increase exceeds 20%, it must be spread over three years, allowing policyholders to adjust financially. This approach aims to mitigate the shock of sudden price hikes that have plagued many consumers in the past.

The bill has sparked notable debates among lawmakers and industry stakeholders. Proponents argue it is a necessary step to protect vulnerable seniors who rely on long-term care insurance, while opponents, including some insurance companies, warn that these regulations could lead to higher premiums overall as insurers adjust to the new requirements.

Economically, the bill could stabilize the long-term care insurance market by fostering transparency and accountability, potentially leading to more competitive pricing. Socially, it addresses the pressing issue of affordability in healthcare, particularly for an aging population that increasingly depends on such policies.

As the bill moves through the legislative process, its implications could reshape the landscape of long-term care insurance in Connecticut, balancing the needs of consumers with the operational realities of insurance providers. If passed, it will take effect on January 1, 2026, marking a pivotal shift in how long-term care policies are managed and priced in the state.