MetLife Inc. says it will no longer sell new long term care (LTC) insurance policies in either the individual or group markets after the end of the year.
The move will not affect coverage for the company's existing LTC insureds, the company says.
The decision to stop writing new LTC insurance business, effective Dec. 30, came after an "extensive review" of the market, according to the announcement by MetLife (NYSE: MET), New York.
The company will continue to accept new applications for individual LTC policies if they are received by Dec. 30. For existing group and multi-life LTC insurance plans, it will stop accepting new enrollments throughout 2011, with the timing based "on existing contractual obligations" with employers, MetLife said.
Current insureds can keep their coverage and, if permitted under the terms of their policy, change benefits such as inflation protection.
"MetLife remains committed to our current LTCI policyholders and certificate holders," said Jodi Anatole, vice president of LTC products for MetLife.
Noting that many Americans are likely to need extended-care services at some point in their lives, Anatole insisted MetLife will continue to look at products that could help attend to LTC financing needs while meeting the company's goals. That could include combining LTC insurance with other products, she said.
"While this is a difficult decision, the financial challenges facing the LTCI industry in the current environment are well known," Anatole said in a statement.
Although sales in the LTC insurance business grew 13% in the first half of this year, recent years have seen dismal sales performance for the product, data from LIMRA, Windsor, Conn., show. LTC sales were 30% lower in the first half of 2009 than in the same period the year before, and, except for a 3% increase in 2007, LTC sales fell every year since 2002, according to LIMRA.