Carrier Rate Increases – What YOU Need to Know

There are two components that go into what your clients are likely to receive as their rate increase. When you see a carrier state that they have an X% rate increase in a particular state on a particular plan, that is usually only half of the story. The part that agents often forget is that, in most states, Attained Age ratings are used by the carrier. This video explores the two components of the Attained Age (most common) rate increases clients experience: Types of Medicare Policy Ratings Community Rated (Required of all carriers in AR, CT, ME, MN, NY, VT, WA) Note: Some other carriers use Community Rating nearly everywhere (AARP and some Blue Cross plans). The same monthly premium is charged to everyone who has the Medicare policy, regardless of age. Premiums are the same no matter how old the applicant is. Premiums may go up because of inflation and other factors, but not based on age. Premiums tend to be higher than the national average in these states since the premium is weighted between all ages and genders. Issue age rated (Required of all carriers in AZ, GA, FL, ID, MO, NH). The premium is based on the age the applicant is when the Medicare policy is bought. Premiums are lower for applicants who buy at a younger age, and won’t change as they get older. Premiums may go up because of inflation and other factors, but not because of the applicant’s age. We find that issue age states tend to have higher nationally averaged premiums, but are much more stable over time. Attained age rated (Most Common) The premium is based on the applicant’s current age so the premium goes up as the applicant gets older. Premiums are low for younger buyers, but go up as they get older. In addition to change in age, premiums may also go up because of inflation and other factors. Most carriers promise to only give a one-time rate increase per year, with both factors (state-factor and attained-age factor).

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