America’s Top Insurance Lawyer, Frank N. Darras, Commends Governor Brown For Signing AB 999

AB 999 is one of the strongest Long Term Care insurance consumer protection measures in the country.

October 2, 2012

Frank N. Darras, America's top long term care lawyer, voiced his support today for Governor Jerry Brown's recent decision to sign AB 999. The bill will protect consumers from excessive premium rate hikes in long-term care insurance by modifying the rate development process. It will also allow consumers to make more informed decisions when buying a long-term care insurance policy by giving them the chance to review policy language before purchase.

"Rate hikes have been a growing problem in long-term care insurance and have forced many Americans to avoid purchasing this much-needed form of insurance. As an insurance lawyer who specializes in long-term care and disability, I fight wrongful claim denials and abuses every day. The drastic rate increases in recent years has forced many seniors, especially those on fixed incomes, to live unprotected. The passing of this bill by Governor Brown is a welcome victory for all consumers," says Darras.

The bill, authored by Assembly Aging and Long-Term Care Committee Chair Mariko Yamada and sponsored by Insurance Commissioner Dave Jones and the California Department of Insurance, is one of the strongest LTC insurance consumer protection measures in the country. It will prevent insurers from passing poor investment returns on to policyholders and justifying rate increases by "cherry-picking" a small number of policies. Most importantly, policyholders won't continue to see the 10-15% a year rate increases that have become the norm over the past 10 years.

"This bill is all about transparency and consumer protection. Americans have a right to affordable long-term care protection without the risk of crippling rate increases," says Darras.

Long-term care insurance came about in California in the early 1980's. The first companies to offer it had little experience to base premium rates off of and failed to take inflation into account. These companies soon realized that the initial pricing of LTC was based on inaccurate assumptions and premium rates were used to compensate for their losses.

"The consumer has been paying the steep price of carriers overselling and under-pricing long term care policies. This bill will help to shift the responsibility back onto insurance companies and provide policyholders more stabilization. If the company makes a bad investment they should pay the price-NOT the consumer," says Darras.

The measure becomes effective on January 1, 2013. Policyholders are encouraged to follow up with their insurance company or consult a top insurance lawyer with any questions.

"I thank Assembly Member Mariko Yamada for her dedication and leadership, commend Governor Brown for signing it, and thank all those who worked hard towards passing this very important piece of legislation," says Darras.