Good for the Long Term?

Moves are under way to prevent large, unexpected rate increases that tarnish the image of long-term-care insurance.

California State Sen. Joseph Dunn, D-Orange County, had been in office about a month when a retired couple came to him in December 1998 with an unhappy story. They had carefully researched and then bought a guaranteed renewable long-term-care insurance policy a few years earlier, but they had to give it up when they couldn't afford the large premium increases.

Their story is not an isolated case as many long-term-care insurers try to balance competitive pricing with their limited underwriting experience. Premiums for some long-term-care insurance policies have jumped 20% or more in a single year, forcing some policyholders to drop coverage and hurting sales efforts.

Long-term-care policies are guaranteed renewable, which allows insurers to raise rates for an entire class of policyholders. But several producers, responding to a Best's Review survey in October, said premium increases are a major concern for them and their clients. A report on rate increases released last fall by Larson Long Term Care Group LLC documented widespread hikes on policies sold as level-premium policies. (See "Raising the Rates," page 100.)

"Some are regularly raising rates on an annual basis, and they're not small rate increases," said Ralph Teller, a co-author and researcher at the Bothell, Wash., firm. "Twenty [percent] to 25% is fairly common. Some are 40% to 50% or more. Typically, they are 10% to 20%."

The hefty increases are coming from both large and small insurers.

The couple that visited Dunn bought their policy as an element of their financial plan while they were still working. After they retired, their insurer raised premiums by 18% one year, 21% the next year and a comparable percentage in the year after that. "They were on a fixed income and couldn't afford to carry on the policy," Dunn said. "They said they had tried to be frugal and shopped for the lowest premium. They knew the company could raise the premium, but they didn't know they would be subjected to massive premium increases."

Their plight prompted Dunn to investigate long-term-care insurance in California and how it is regulated. He found that while most insurers price according to actual cost, some companies were underbidding for business. He subsequently introduced legislation to regulate unwarranted rate increases by requiring companies to offer a policy that guarantees the annual premium will not increase. It passed the Senate but was eventually voted down, 6 to 4, in an Assembly committee. Dunn intends to renew his efforts this year. He is willing to work with insurers to find middle ground, he said, but "I won't cross a line past which bad actors can still act badly."

Dunn's office has been "inundated" by calls from insurers that oppose a mandate, telling him that a noncancellable, guaranteed-premium product is not feasible.

"The products we're selling today have only been on the market five or 10 years; there's a lot we don't know about how that business will run out," said Richard Garner, senior vice president of CNA Long-Term Care.

Changing social behaviors contribute to that uncertainty, Garner said. Insurers can't predict whether government will provide long-term-care programs, how long people will stay in their homes with home health care or how long they will be in nursing homes. So the guaranteed renewable policy form, which allows rate increases only when applied to a group of policyholders, not just to an individual, is the appropriate one for long-term-care insurers today Garner said. "We've all seen the difficulties disability income insurers went through, and we don't want to repeat that," he said.

General Electric Financial Assurance Group was the only insurer that supported Dunn's bill, although the company would prefer to see the National Association of Insurance Commissioners develop a uniform law that could be adopted by all state legislatures. With $594.3 million in net premiums, GE sold more long-term-care policies in 1998 than any other insurer, according to A.M. Best Co. data. In the 25 years it has been in the business, the company has never raised premiums on existing contracts.

"From the very beginning, our commitment was to provide an LTC product with a hallmark of rate stability that people could count on:' said Kathleen M. Ligare, senior vice president of marketing in GE's Long-Term Care Division. "When we set prices and design products, we are always taking a long-term view."

GE is continuing to work with Dunn and insurance trade and regulatory organizations on the issue of rate stability as it seeks legislation that could be implemented nationwide, Ligare said. "Not that we wouldn't support a separate solution in California," she added. "If it were a good solution to get the ball rolling, we would support it."

The Elusive Goal: Stable Pricing

Accurate pricing of long-term care faces several hurdles.

"The bottom line to the LTC market is that it's a developing market," said Douglas A. Collett, a vice president in the life/health division of A.M. Best Co. "Longevity is increasing, medical technology and advancements continue to play a role, and we have a population growing into this target market. With all these dynamics, it's difficult to price these products, especially when you don't have years and years of data on which to base these prices."

Some agents who responded to the Best's Review survey fear that insurers underprice policies just to get business on the books and will lack up premiums later. Several agents' responses favored premium guarantees.

"A level premium is the ultimate goal for the consumer, but many companies don't have the claim experience to guide them;' Collett said. "Larger companies have the financial wherewithal and ability to keep premiums level for at least the first 12 or 13 years."

Eamon Walsh, an account executive for Willis Inc. in New York, used to worry that insurers were not charging enough. Companies that a few years ago were charging "ridiculously low prices" are now raising premiums or trying to get out of the business, he said. Companies writing long-term-care policies today are more comfortable with the risks and price their products to hold steady for 13 to 15 years, Walsh said. This fact makes legislation mandating guaranteed premiums unnecessary and unrealistic, he added.

"A noncancellable policy requirement would probably bankrupt an insurance company;' he said. "You can't charge today's dollars for a long-term care risk 20 years from now. That's like requiring a refrigerator company to guarantee today's prices forever."

10-Year Guarantee

To alleviate agent and consumer concerns about rate hikes, CNA Financial Corp., Chicago, has begun guaranteeing level premiums for the first 10 years on all policies sold after Sept. 15, 1999. "It was time to take a stand on an issue as important as rate stability," Garner said. With reports of some companies charging substantial increases soon after a policy is issued, CNA was worried "the public would get the wrong idea about the big companies," he said. The move scored well with producers, too.

"That's a good deal," said Dick Miller, a self-employed broker in Harrisonburg, Va., when told of CNA's guarantee. "That ought to make a lot of other carriers look at guarantees the same way. [CNA] will write some business on that."

Walsh predicted that several companies would meet CNA's ante. It happened with other elements of long-term-care product design after the Kennedy-Kassebaum health-care reform act of 1996, and it happened with lower term-life premiums, he said.

"With LTC, you won't see the rate reductions, but you will see rate

Guarantees", he said. "It's really not that difficult to do. Good carriers haven't had to raise rates. The big players are very strong, and they're not taking bad risks."

But William E. Myers, president of Althoff Insurance Unlimited Life & Health Services Inc., an agency in Effingham, Ill., is not sold. "They need to make it for life or guarantee they won't raise it more than 5% after 10 years," he said. "A lot of people buying them are seniors on a fixed income, and the only increase in income they get is Social Security."

Myers has sold 10 long-term-care policies over the past five or six years. One was to a 65-year-old man for a $900 premium. When the insurer was acquired the following year, the premium increased 55% to $1,400. Both Myers and the client were taken by surprise. Among the lessons he learned, Myers said, is that agents need better training from companies on long-term-care products, which are complex. Myers has since attended some educational events to learn more, he said.

To Miller, the 10-year guarantee is significant to people in their 60s, who might use the benefits within that time period. For people aged 40 to 50, the guarantee is much less meaningful because their potential long-term-care needs are farther off. For younger buyers, Miller suggested that insurers offer step-rated premiums with each step lasting five years. Premiums in the early years of such contracts should be lower than for contracts that seek to keep premiums level throughout the policyholders' lives, and Miller believes that might entice younger buyers. With current designs, long-term-care products are difficult to sell to people in their late 50s, he said.

CNA's typical buyers are couples in their early 60s, but Garner said the average age of CNA policyholders is among the lowest in the individual market. The average age for other companies is 65 or 70, he said. People in their 40s who buy long-term-care insurance typically purchase group products.

Underwriting Is Key

Quality underwriting is probably the best determinant of a company's ability to keep premiums stable, but KM. Best's Collett said long-term-care underwriting practices vary widely. Some insurers, regardless of size, hardly underwrite at all, he said.

Walsh has a simple test: "You want a company with a very tough screening process in the beginning. You don't want a company that didn't screen well at the time of application but will instead screen at the time of a claim."

Most underwriters don't require a blood sample because abnormalities there relate more to dying than to lingering, Walsh said. Instead, they should be checking family history, current physical state and current activities. "If a prospect is 65 years old and active, chances are an insurer will collect premiums on him for 10 to 15 years," said.

Walsh also believes that insurers should require a statement from an attending physician for applicants age 60 or older. An applicant at that age who doesn't see a doctor regularly is likely to be a risk, he said.

The industry, still in its infancy; is 10 years off from having a good understanding in its pricing and underwriting, said Robert L. Pearson, president and chief executive officer of Care-Quest Inc., a Madison, Wis.-based consulting firm specializing in long-term-care planning. Until long-term-care policies can hold their value for 15 to 50 years, Pearson wrote in a report, Long-Term Care: Addressing the Real Issues, working-age Americans should know that they can't rely completely on the policies to protect their life savings. Agents and clients should compare policies by the quality of underwriting, not just by pricing, he advised in an interview.

"Here's the real problem: Most policies cover use of assisted-living facilities, but insurers don't have the statistics on these yet because they are so new," he said. "The companies don't know what to expect." Some policies with long guarantees exist, particularly those that are paid up in a single year or up to 20 years. Pearson said he hoped that "the insurance companies have built some cushions into those [prices]."

Adverse Selection

Beyond premium guarantees, the marketplace itself offers some protection from unwarranted rate increases. "If a company raises rates too much, healthy people will go elsewhere and sick people will stick with their policies," Walsh said. That's what happened with annually renewable term-life policies until insurers began to offer level premiums.

With that in mind, Walsh said, consumers would do well to pick longstanding companies that have a sizable book of business and a record of keeping premiums stable. "If a large company like John Hancock, Unum, CNA or GE Capital sells a product with a $3,000 premium, and Company XYZ charges $1,500, that should sound an alarm," he said.

Opinion is mixed about the need for standardized long-term-care policies. Insurance broker Myers said he would like to see the government standardize policies, much as it did with Medicare supplemental policies in the 1980s when there were as many policies as there were companies. "Now the government allows only a few, and the only difference is the price," he said.

Broker Miller disagrees. "We should do anything and everything we can to keep the government out of it," he said. "Let the market determine the kinds of policies."

Pearson, who previously worked with the U.S. Health Care Financing Administration, said standardization is worth a look. "It would give the consumer a better way of comparing price and provide a better way of standardizing underwriting procedures," he said. "We need that both for the agents that sell it and for the consumer."

But Pearson said the government should avoid requirements for nonforfeiture values and rate guarantees. Nonforfeiture values provide policyholders some paid-up coverage if they allow their policies to lapse. Walsh said a nonforfeiture requirement could double policy costs.

The federal government is tentatively pursuing another role in the long-term-care market: providing incentives through the tax code. "Government has a stake in seeing private LTC insurance succeed," Collett said. "Government can't take on this liability itself, and it has shown signs of supporting private-sector concerns through tax incentives."

"Private LTC is the government's escape hatch for expenses it cannot handle," Walsh said. "If anything, government should make it easier and more lucrative for insurers."

Raising the Rates

Rate increases of 10% to 25% for long-term-care insurance are common, with a few policies' premiums rising by 40% or even 50% in a single year. But increases in consecutive years for the same contract are rare, according to Larson Long Term Care Group LLC, Bothell, Wash., which tracks rate increases in 48 states and the District of Columbia.

The willingness of state regulators to raise rates could be waning. Florida, Georgia, Kansas, Iowa, North Dakota, South Dakota and Virginia are denying rate increases more often, said Ralph Teller, researcher and co-author of a report issued by Larson in September. "States are just beginning to deal with the issue of rate stability," he said.

Among the findings of the group's report:

* Some states limit rate increases. Delaware limits increases to 20% per calendar year. Kentucky, Maryland and Oklahoma limit them to 15% during any 12-month period. New Mexico imposes a three-year initial-rate guarantee.

* Wisconsin imposes a three-year initial-rate guarantee and a two-year guarantee on subsequent increases. Rate increases cannot exceed 10% for insureds over age 75 with policies in force for more than 10 years. It also prohibits an insurer from issuing new policies for two years if its rates rise more than 50% in any three-year period.

* Regulators in Texas and Missouri do not have authority to approve long-term-care insurance rate increases. Rate increases become effective when companies file the new rates with the department.

* New York last approved a rate increase for a long-term-care policy in 1994.

* California's Department of Insurance approved long-term-care insurance premium increases for eight companies for the three years ended June 1999. All 28 increases approved by California from 1997 through 1999 were for the amounts requested by the companies. Of the 33 increases approved in California since 1993, only one--a 50% increase request in 1994--was reduced before approval, to 25%.

* Montana does not scrutinize rate increases at all, and there is little scrutiny in Idaho, though the increases in those states are not much different from those in most others.

Top Writer Counts on Flexibility

Careful underwriting and strong actuarial research have helped General Electric Financial Assurance Group hold rates steady for 25 years, said Kathleen M. Ligare, senior vice president of marketing in GE's LongTerm Care Division. The division, based in San Raphael, Calif., covers more than 450,000 lives.

GE requires an attending physician statement for every applicant. Beyond that, the company uses a flexible underwriting procedure that varies depending on a prospect's age and health history

Some prospects will need to be interviewed by phone. Others may require face-to-face assessments by a network of nurses contracted by the company GE also considers cognitive abilities in its assessments.

The company has increased sales of individual policies to younger people-those in their 40s and 50s-who typically obtain coverage under group policies. The flexible underwriting process means that these buyers may need little more than a doctor's note to qualify for coverage. For many of them, a check of their written medical records can be enough.

"We work very hard on the need to balance sound underwriting with expediting the process;' Ligare said. "We don't treat every application in the same way."

From the beginning, GE's policies have covered all levels of nursing home care, the company said. Its policies today give buyers a choice of any combination of coverages for nursing homes, assisted-living facilities, day care or home health care. To help keep its older policies relevant, owners have the option of converting to new policies to take advantage of the new coverages, Ligare said.

GE also recognizes that delivery of long-term care is likely to change in the future. To address those unpredictable changes, GE's current policies include a feature that allows for alternative plans of care. The policies also offer access to a care coordinator to help families work Out a plan of coverage. "This gives us the freedom to change and update features of the future," Ligare said. "We've learned over the years to build flexibility into our design so that there's less chance people will have to convert,"

GE competes against companies offering lower prices in two ways. One is by helping the consumer to evaluate features and flexibility and make an apples-to-apples comparison, Ligare said. The other is by showing consumers how long-term-care insurance fits into their personal financial plans.

Along those lines, the company began a nationwide campaign on Dec. 1, its 25th anniversary in the business, to raise awareness of long-term-care insurance. The campaign includes an expanded Internet-based initiative, more local seminars for consumers and national television spots on Sunday-morning news programs and cable channels. This spring, GE will sponsor a roundtable in Washington, D.C., to discuss long-term-care issues on the national public policy agenda.

                Leading Writers of Individual Long-Term Care
                   Rank based on 1998 net premiums written
                                                      1998
                                                    Market       1998 Net
Rank Company                                  State  Share       Premiums
 1   General Electric Capital Assurance       DE    21.40%   $594,284,973
 2   American Travellers (Conseco Sr. Health) PA    13.83     384,018,892
 3   American Family Life (Aflac)             GA    11.26     312,754,622
 4   Bankers Life & Casualty                  IL     9.70     269,406,463
 5   Travelers Insurance                      CT     7.67     213,132,461
 6   John Hancock Mutual Life                 MA     5.50     152,652,306
 7   Time Insurance (Fortis Ins. Co.)         WI     3.69     102,584,339
 8   IDS Life                                 MN     3.38      93,893,393
 9   Bankers United Life                      IA     3.13      86,814,784
10   Employers Reassurance                    KS     2.13      59,188,782
11   PFL Life                                 IA     2.02      56,193,056
12   Unum Life of America                     ME     1.98      54,920,654
13   GE Capital Life Assurance                NY     1.30      36,183,839
14   National States Insurance                MO     1.09      30,188,359
15   Teachers Insurance & Annuity             NY     1.03      28,712,661
16   Life Investors of America                IA     1.03      28,482,895
17   New York Life                            NY     0.87      24,131,789
18   Mutual of Omaha Insurance                NE     0.86      23,949,628
19   Continental General Insurance            NE     0.73      20,257,334
20   Pioneer Life                             IL     0.68      18,754,989
21   Cologne Life Reinsurance                 CT     0.65      18,115,106
22   American Heritage Life                   FL     0.56      15,510,080
23   Equitable Life & Casualty                UT     0.54      14,919,487
24   Finger Lakes Long Term Care              NY     0.50      13,964,002
25   Physicians Mutual Insurance              NE     0.50      13,921,056
26   Medamerica Insurance                     PA     0.48      13,359,700
27   Transamerica Occidental Life             CA     0.38      10,433,968
28   Kanawha Insurance                        SC     0.31       8,611,688
29   Medico Life                              NE     0.31       8,605,723
30   IDS Life Insurance of New York           NY     0.27       7,446,187
31   United American Insurance                DE     0.26       7,341,240
32   Standard Life & Accident                 OK     0.25       6,855,296
33   First Unum Life                          NY     0.23       6,515,846
34   Censeco Life                             NY     0.21       5,788,861
35   Monumental Life                          MD     0.20       5,599,405
36   Guarantee Trust Life                     IL     0.18       4,986,042
37   Fortis Benefits Insurance                MN     0.15       4,241,052
38   Continental Assurance                    IL     0.13       3,730,846
39   Trustmark Life                           IL     0.12       3,467,481
40   Allianz Life of North America            MN     0.11       3,050,719
41   Great Republic Life                      WA     0.09       2,636,399
42   American Republic Insurance              IA     0.07       1,830,101
43   American Fidelity Assurance              OK     0.06       1,607,714
44   Universal Fidelity Life                  OK     0.06       1,536,078
45   ReliaStar LIfe                           MN     0.05       1,439,212
46   American Progressive Life  Health        NY     0.04       1,151,549
47   Union Labor Life                         MD     0.04       1,097,641
48   Combined Insurance of America            IL     0.04       1,015,176
49   Pyramid Life                             KS     0.04         986,400
50   Connecticut General Life                 CT     0.03         848,618
     Top Companies:                                        $2,781,118,892
     Percent       1997 Net Percent       1996 Net Percent        1995 Net
Rank Change        Premiums Change        Premiums Change         Premiums
 1    33.09%   $446,543,259  27.56%   $350,070,760    5.54%   $331,700,955
 2     2.27     375,488,674   7.94     347,869,834  -40.69     586,529,095
 3    -6.25     333,620,830  -1.09     337,309,946    7.82     312,856,781
 4    18.76     226,848,816  17.88     192,447,810   24.87     154,122,925
 5    15.94     183,828,053  43.98     127,679,804   44.15      88,572,483
 6    10.80     137,767,523  45.31      94,810,139   11.49      85,037,044
 7    16.04      88,406,041  29.16      68,445,827   34.81      50,770,926
 8    13.77      82,525,572  21.69      67,815,165   22.70      55,267,317
 9    11.46      77,885,690  20.29      64,750,178   18.99      54,415,359
10    35.16      43,791,283    N/A               0     N/A      24,364,082
11    15.77      48,537,573  26.74      38,298,104   31.69      29,082,543
12    17.41      46,775,513  10.47      42,341,308     N/A               0
13    19.96      30,164,269 -32.42      44,632,293     N/A               0
14    25.96      23,966,426  21.84      19,669,795    8.74      18,089,599
15    14.00      25,187,171  30.33      19,326,200   94.71       9,925,417
16     4.84      27,167,431  16.90      23,239,789   14.99      20,209,784
17    31.39      18,366,170  41.27      13,000,825   97.59       6,579,763
18     8.48      22,077,080  -0.50      22,188,424    0.16      22,153,586
19    24.23      16,305,748  77.11       9,206,760  132.71       3,956,360
20   -26.58      25,545,602 100.75      12,725,348  132.46       5,474,200
21   -33.15      27,098,882 151.63      10,769,484     N/A               0
22    15.56      13,422,179  63.03       8,232,762  160.98       3,154,599
23    26.95      11,752,065  68.71       6,965,705  -29.27       9,848,321
24    11.54      12,519,472  17.49      10,656,170   27.03       8,388,528
25    33.68      10,413,973  29.35       8,051,160   45.03       5,551,475
26    11.52      11,979,598 137.39       5,046,379   34.64       3,748,128
27    30.42       8,000,000    N/A               0     N/A       4,172,066
28    96.52       4,382,068 113.84       2,049,223  273.61         548,496
29    13.63       7,573,776   1.54       7,458,776   -8.59       8,160,034
30     9.16       6,821,072  18.92       5,735,615   32.13       4,340,852
31    15.77       6,341,231  16.59       5,438,873    4.44       5,207,839
32     2.62       6,680,406 271.25       1,799,437   -4.75       1,889,214
33    65.34       3,940,766  81.16       2,175,318   84.33       1,180,136
34      N/A               0    N/A               0     N/A               0
35   -24.06       7,373,368 -11.05       8,289,109  -17.93      10,100,078
36    -4.91       5,243,390   0.22       5,231,849     N/A               0
37      N/A               0    N/A               0     N/A               0
38    49.09       2,502,387 165.44         942,722  243.01         274,841
39   -63.85       9,591,269    N/A               0     N/A               0
40   150.02       1,220,210 143.57         500,975  240.09         147,306
41      N/A               0    N/A       4,109,265  -12.97       4,721,530
42    -7.67       1,982,028  -2.00       2,022,506  -37.85       3,254,152
43      N/A               0    N/A               0     N/A               0
44    -3.85       1,597,584    N/A               0     N/A               0
45    13.83       1,264,405 -23.10       1,644,126    1.88       1,613,723
46    66.31         692,410    N/A               0     N/A         104,743
47    11.09         988,052  90.72         518,076    6.89         484,699
48    71.83         590,801  -5.05         622,224  -11.61         703,915
49    44.63         682,001  30.63         522,072   25.60         415,675
50   -14.18         988,821  -7.00       1,063,194  -11.88       1,206,467
      13.68% $2,446,440,938  22.59% $1,995,673,329   2.96%  $1,938,325,036
     Percent
Rank Change
 1    19.62%
 2   147.08
 3    69.66
 4    33.22
 5    44.26
 6    34.58
 7    90.99
 8    22.04
 9    21.75

10   274.77
11    48.51
12      N/A
13      N/A
14      N/A
15    23.91
16    15.98
17   322.63
18    -0.73
19   194.23
20    43.67
21      N/A
22      N/A
23    -0.96
24     9.87
25    51.94
26      N/A
27      N/A
28   999.99
29    -4.58
30    25.31
31    28.67
32    -5.96
33      N/A
34      N/A
35   -13.98
36      N/A
37      N/A
38    -5.55
39      N/A
40   678.12
41     6.44
42    22.78
43      N/A
44      N/A
45     1.40
46      N/A
47     5.84
48   -10.49
49    56.28
50   -14.68
      59.54%
Source: A.M. Best questionnaire. The complete study, which includes
data from 89 insurers, is availablein Best's Sales Studies, Health Sales
Results, 1999 Edition.
                  Leading Writers of Group Long-Term Care
                  Rank based on 1998 net premiums written
                                                       1998
                                                     Market     1998 Net
Rank Company                                  State   Share     Premiums
 1   Metropolitan Life                        NY     33.65% $146,201,606
 2   General Electric Capital Assurance       DE     16.21    70,437,581
 3   Aetna Life                               CT      8.58    37,253,866
 4   John Hancock Mutual Life                 MA      7.15    31,054,469
 5   Unum Life of America                     ME      6.30    27,353,610
 6   American Travellers (Conseco Sr. Health) PA      4.36    18,926,504
 7   PFL Life                                 IA      3.81    16,563,524
 8   Pioneer Life                             IL      2.80    12,174,011
 9   Mutual of Omaha Insurance                NE      2.19     9,494,124
10   New York Life                            NY      1.96     8,498,745
11   Life Investors of America                IA      1.59     6,896,075
12   IDS Life                                 MN      1.51     6,565,162
13   Medamerica Insurance                     PA      1.48     6,447,275
14   American Republic Insurance              IA      1.37     5,938,130
15   Cologne Life Reinsurance                 CT      1.32     5,755,877
16   Allstate Life                            IL      0.80     3,477,821
17   Allianz Life of North America            MN      0.78     3,388,891
18   Provident Life & Accident                TN      0.74     3,205,770
19   Life Insurance Co of North America       PA      0.64     2,765,007
20   Washington National                      IL      0.44     1,930,634
21   Transamerica Occidental Life             CA      0.40     1,747,555
22   Manulife Reinsurance                     MI      0.39     1,691,527
23   First Unum Life                          NY      0.35     1,514,457
24   Finger Lakes Long Term Care              NY      0.32     1,408,391
25   Hartford Life & Accident                 CT      0.20       847,319
26   Cooperativa de Seguros de Vida           PR      0.10       450,467
27   Provident Life & Casualty                TN      0.10       431,205
28   Great Republic Life                      WA      0.08       353,632
29   Monumental Life                          MD      0.08       328,510
30   Medical Life                             OH      0.07       299,096
31   GE Capital Life Assurance                NY      0.04       187,985
32   ReliaStar Life                           MN      0.04       174,677
33   Government Personnel Mutual Life         TX      0.03       140,730
34   BCS Life                                 IL      0.03       120,953
35   Colonial Penn Life                       PA      0.02       104,884
36   American Progressive Life & Health       NY      0.02        71,883
37   Trans-General Life                       CT      0.02        71,187
38   Bankers Life & Casualty                  IL      0.02        70,815
39   Idealife Insurance                       CT      0.01        60,827
40   Hartford Life                            CT      0.01        22,620
     Top Companies:                                         $434,427,402
      Percent     1997 Net  Percent     1996 Net  Percent     1995 Net
Rank   Change     Premiums   Change     Premiums   Change     Premiums
 1    129.42%  $63,727,612   12.93%  $56,431,578    8.79%  $51,873,842
 2      1.96    69,084,023   11.69    61,851,792    7.70    57,427,821
 3       N/A             0     N/A    40,249,338   13.12    35,582,666
 4    -26.85    42,452,520  -31.85    62,292,048   14.38    54,458,362
 5     29.45    21,130,576  999.99      -903,728     N/A    24,457,689
 6    -10.52    21,150,572     N/A             0     N/A    16,696,978
 7     -4.39    17,324,127   -3.86    18,020,507   -4.86    18,940,925
 8    -39.69    20,186,401   54.35    13,078,249    8.08    12,100,894
 9     -3.15     9,802,509    0.08     9,795,052    0.86     9,711,237
10      1.00     8,414,579   -5.61     8,914,545     N/A             0
11     80.52     3,820,048   47.56     2,588,876   15.18     2,247,607
12      8.75     6,036,966   19.99     5,031,285   17.03     4,299,135
13     63.86     3,934,712  999.99       124,576  152.33      -238,074
14     -2.00     6,059,516   -0.25     6,074,696    0.47     6,046,314
15     62.67     3,538,304   62.38     2,179,000     N/A             0
16     -1.07     3,515,326   -4.73     3,689,950   -1.46     3,744,529
17    -29.82     4,828,660  -30.22     6,920,065   15.71     5,980,366
18     -4.78     3,366,613   -3.71     3,496,450     N/A             0
19    -11.71     3,131,822   11.85     2,799,935  -14.64     3,280,080
20    130.26       838,471   58.27       529,758  100.76       263,878
21       N/A             0     N/A             0     N/A             0
22     45.44     1,163,063     N/A             0     N/A             0
23     54.96       977,293   39.50       700,570  100.55       349,326
24     36.51     1,031,691   48.58       694,385  115.80       321,773
25      7.17       790,647  -22.32     1,017,797  -50.84     2,070,529
26    -13.28       519,460   13.31       458,446  -20.29       575,121
27     -4.73       452,612   -7.62       489,925     N/A             0
28       N/A             0     N/A       436,309  -10.70       488,578
29      0.40       327,200   -5.23       345,259  -10.22       384,568
30    -48.39       579,477   42.95       405,383    5.51       384,203
31     -7.37       202,945  -72.90       748,804     N/A             0
32     -3.29       180,618   -7.57       195,414   -9.41       215,711
33    -14.64       164,872   -5.80       175,032  -13.82       203,093
34     20.76       100,159  -25.26       134,006  -36.24       210,182
35    -15.60       124,273     N/A             0     N/A             0
36     75.76        40,899     N/A             0     N/A             0
37       N/A             0     N/A             0     N/A             0
38    247.69        20,367    0.59        20,248   26.91        15,955
39    999.99           831  -97.25        30,266  -79.62       148,491
40    144.81         9,240     N/A             0     N/A             0
       36.17% $319,029,004    3.24% $309,015,816   -1.03% $312,241,779
      Percent
Rank   Change
 1     11.63%
 2      5.36
 3     14.02
 4       N/A
 5       N/A
 6    -33.30
 7     -5.16
 8      6.07
 9      3.13
10       N/A
11     69.87
12     13.71
13       N/A
14     -0.32
15       N/A
16     -0.96
17     -4.79
18       N/A
19    -38.96
20       N/A
21       N/A
22       N/A
23       N/A
24    -30.07
25     14.54
26     20.59
27       N/A
28    -12.03
29    435.85
30      6.90
31       N/A
32     -4.50
33    -15.21
34    225.43
35       N/A
36       N/A
37       N/A
38      7.22
39    -95.35
40       N/A
       34.53%
Source: A.M. Best questionnaire. The complete study,
which includes data from 42 insurers, is available in
Best's Sales Studies, Health Sales Results, 1999 Edition.