ORLANDO,Fla. - Thousands of consumers may see huge increases in their long term insurance rates. And many say they'll have to cancel the coverage they were counting on.
"I'm a firm believer in taking care of yourself if you possibly can," said Tiedemann.
The John Hancock policy covered everything from in home care to a nursing home that Medicare did not. Tiedemann said he bought in early for the lower premiums but two months ago he received a notice saying his premium shot up by 44 percent.
"It totally shocked and floored me," said Tiedemann.
Now, he said, his policy will cost nearly $2,300 a year, a $700 hike.
"This was just an outlandish increase," said Tiedemann.
The John Hancock company said Florida' Office of Insurance Regulation had approved the new rate.
Tiedemann said that happened without any warning to customers.
In state rate cases over the past
Most companies claimed health care costs increased faster than forecast, a big reason they claimed, many clients spent more time in nursing homes, up to a year longer than anticipated.
"And that's expensive. The company is going to spend far more per patient than they collect in premiums from each enrollee," said UCF professor Aaron Lieberman.
Unlike other insurance, state regulators can't limit increases if the companies can prove future loses.
Tiedemann canceled his policy after paying for 10 years.
"Then I'm going to be a burden on someone, somewhere down the line because I don't have the cash to pay for it," said Tiedemann.
Tiedemann could have lowered the amount of coverage to keep his current premium but he was still worried about future rate hikes. John Hancock Insurance had no comment.
John Hancock told Action 9 that it works with every customer to develop a coverage plan they can afford.