The legislature’s Human Services Committee voted Thursday to advance a bill that would impose consumer protections for long-term care insurance policyholders, boost financial disclosure requirements for insurers and allow the state attorney general to investigate carriers.

“I know that the [National Association of Insurance Commissioners] and other national leaders look to Connecticut as a leader on insurance issues. And yet, on this issue, we have been timid,” Sen. Matthew Lesser, a Middletown Democrat and co-chair of the committee, said at a public hearing this week.

Long-term care insurance plans “have been designed to be unaffordable year after year, where you see these catastrophic, unsustainable increases, but people are locked in,” he added. “It’s really a market failure, and we haven’t adequately policed the market to ensure that companies are doing right by their policyholders.”

The bill would require insurers to file annual reports with the state on incurred and actual paid losses for policies issued through the Connecticut Partnership for Long-Term Care, a joint program by the state and private industry that has sold coverage to more than 60,000 people since its inception in 1992. The secretary of the Office of Policy and Management must share that financial information with legislators.

The state Insurance Department would only be able to pre-certify long-term care policies that do not tie compensation to the approval of higher rates for policyholders. The Connecticut Mirror in 2025 revealed that one of the largest providers of long-term care insurance in the U.S., Genworth Financial, ties its executive compensation to its ability to obtain annual price increases from policyholders. In 2023, the company’s CEO received more than $9.8 million in compensation, including $3.2 million in incentive pay, a portion of which was directly linked to Genworth’s success in increasing premiums.

Genworth is one of two companies currently selling long-term care coverage through the Connecticut partnership program.

The bill passed out of the Human Services committee Thursday also requires the OPM secretary to study the effect of a proposal that insurers let policyholders cancel their plans and obtain refunds for premiums paid since the start of the coverage whenever a carrier files for rate hikes that exceed the rate of inflation.

Additionally, insurers would have to provide details of all reinsurance contracts associated with their LTCI plans.

The measure also gives the state attorney general the power to investigate insurance companies for practices or patterns that violate state law.

Human Services Committee members voted unanimously Thursday to advance the proposal.

“If we really want to fix this problem, we need to get everybody to the table, hold people accountable and have real conversations about what we can do,” said Rep. Kurt Vail, R-Stafford. “It’s a big problem, and I don’t know that it gets enough attention. … Kicking the can down the road and jacking up the rates of the insured is definitely the wrong approach, and this bill puts some of the onus back on the insurance industry.”

Policyholders testified and wrote to lawmakers expressing support for the proposal at a hearing earlier this week, while insurance sector representatives opposed it.

“I support S.B. 478, which I believe takes a big bite out of the punishment approximately 100,000 Connecticut seniors endure from the vicious, ever-increasing premium rates,” said Jan Kritzman, whose coverage with her husband has climbed to $7,000, up from $2,000 when they bought the plans in 2004.

Policyholder Edward Pallanti urged legislators to adopt the measure.

“I have had a long-term care policy for several years. My premium rates have doubled to an annual premium that is now almost unaffordable,” he wrote. “I fear that any future rate increases will mean that I must cancel my policy.

“Connecticut MUST do what it can to prevent further outrageous premium hikes. I made the responsible choice to pay for future health needs without being a burden to the government or my family. Skyrocketing insurance premium rates have made these policies a financial burden.”

Stephen Owen of Chesire said he supported the bill but wished it offered more protections.

“The current legislation places no limitation on the amount an insurance company can raise its premium,” he noted in written testimony. “The commission that reviews rate requests approved 100% increases with the only restriction being it must be [spread] over three years. This has the potential to raise our annual premiums to $32,000 by 2031. This places insurance company interests above those of policyholders.”

Insurance sector lobbyists, who testified at the hearing and wrote to committee members, raised concerns.

“While we respect the intent behind S.B. 478, we must respectfully strongly oppose the bill as drafted,” Eric George, president of the Insurance Association of Connecticut, wrote in joint testimony with two other industry representatives. “Several of its provisions could significantly disrupt the long-term care insurance market in Connecticut and could ultimately reduce the availability of coverage for consumers.

“It is important to recognize the role private long-term care insurance plays in helping individuals plan for future care needs and reducing reliance on Medicaid. When private coverage becomes less available, more individuals ultimately depend on Medicaid … Policies that unintentionally reduce access to private long-term care coverage risk shifting future care costs to the state’s Medicaid program.”

Nearly 100,000 people in Connecticut have long-term care insurance — coverage that, depending on the policy, supports skilled in-home care, rehabilitation therapy, assisted living, nursing home stays and respite care.

A CT Mirror investigation last year found that the annual cost of maintaining long-term care coverage has skyrocketed for many residents due to miscalculations by insurers on how long people would live, the price of care and how many would need it. Policyholders complained of dramatic rate increases, often exceeding 50% and, for a few dozen people, as high as 174%, according to a CT Mirror analysis.

The CT Mirror’s review of rate hikes from January 2019 to October 2024 showed that more than 17,000 people with long-term care policies have gotten hit with increases of 50% or more. Some of the biggest companies in the market, including Genworth Financial, Metropolitan Life Insurance Company and Transamerica Life Insurance Company, requested hikes for five years in a row beginning in 2019.

When large providers seek premium increases, thousands of consumers can be affected. In 2019, for example, Genworth Financial requested a 40% rate hike on more than 9,000 Connecticut policyholders. In 2021, Transamerica requested a 20% rate increase on 8,000 policies. The insurance department approved both requests with no changes.In 2022, Genworth raised rates for more than 2,000 people by an average of 97%, with increases ranging from 79% to 173%, depending on the policy. The approved amounts were a slight reduction from the company’s original request.

The Human Services bill is one of at least six bills raised on the issue this session. The Aging Committee earlier this month voted to advance a proposal that would increase transparency around long-term care insurance rate hikes and offer consumer protections.