Medigap Insurance: Insurers' Compliance With Federal Minimum Loss Ratio
Standards, 1988-91 (Letter Report, 02/07/94, GAO/HEHS-94-47).
From 1988 through 1991, the market for Medicare supplemental
insurance--commonly called Medigap--grew by more than 50 percent;
premiums rose from about $7 billion to $11 billion. In the first half
of this period, Medigap insurers' loss ratios fell for both individual
and group policies. Beginning in 1990, loss ratios rose, and the 1991
aggregate loss ratios were about at their 1988 levels--80 percent for
policies sold to individuals and 90 percent for group policies. The
loss ratios for individual policies represent a dramatic improvement
from the early 1980s when the federal minimum standards became effective
and aggregate loss ratios were about 60 percent. The premiums
associated with companies whose aggregate loss ratios did not meet the
federal minimum standards fell from $388 million in 1988 to $206 million
three years later. Although this decline suggests that insurers'
compliance with the loss ratio standards improved during the four-year
period, some companies did not meet the minimum loss ratio standards in
every state in which they did business. The premiums collected by these
companies steadily declined during the period, from $126 million in 1988
to $35 million in 1991.
--------------------------- Indexing Terms -----------------------------
REPORTNUM: HEHS-94-47
TITLE: Medigap Insurance: Insurers' Compliance With Federal
Minimum Loss Ratio Standards, 1988-91
DATE: 02/07/94
SUBJECT: Loss ratio
Elderly persons
Health insurance cost control
Insurance regulation
Medicare programs
Insurance premiums
Insurance companies
Compliance
Reporting requirements
IDENTIFIER: Medigap
**************************************************************************
* This file contains an ASCII representation of the text of a GAO *
* report. Delineations within the text indicating chapter titles, *
* headings, and bullets are preserved. Major divisions and subdivisions *
* of the text, such as Chapters, Sections, and Appendixes, are *
* identified by double and single lines. The numbers on the right end *
* of these lines indicate the position of each of the subsections in the *
* document outline. These numbers do NOT correspond with the page *
* numbers of the printed product. *
* *
* No attempt has been made to display graphic images, although figure *
* captions are reproduced. Tables are included, but may not resemble *
* those in the printed version. *
* *
* A printed copy of this report may be obtained from the GAO Document *
* Distribution Facility by calling (202) 512-6000, by faxing your *
* request to (301) 258-4066, or by writing to P.O. Box 6015, *
* Gaithersburg, MD 20884-6015. We are unable to accept electronic orders *
* for printed documents at this time. *
**************************************************************************
Cover
================================================================ COVER
Report to the Chairman, Subcommittee on Health, Committee on Ways and
Means, House of Representatives
February 1994
MEDIGAP INSURANCE - INSURERS'
COMPLIANCE WITH FEDERAL MINIMUM
LOSS RATIO STANDARDS, 1988-91
GAO/HEHS-94-47
Medigap Insurance
Abbreviations
=============================================================== ABBREV
NAIC - National Association of Insurance Commissioners
OBRA1990 - Omnibus Budget Reconciliation Act of 1990
Letter
=============================================================== LETTER
B-252803
February 7, 1994
The Honorable Fortney H. (Pete) Stark
Chairman, Subcommittee on Health
Committee on Ways and Means
House of Representatives
Dear Mr. Chairman:
This is our third report in response to your December 1988 request
that we monitor the value of Medicare supplemental
insurance--commonly called Medigap--to policyholders through 1994.\1
Also, this report is our first under the requirement contained in the
Omnibus Budget Reconciliation Act of 1990\2
(OBRA 1990) that we audit compliance of Medigap policies with federal
loss ratio standards every 3 years.
From 1980 through the enactment of OBRA 1990, the Congress has
periodically passed legislation and conducted oversight hearings to
improve the value of Medigap insurance to the elderly. One measure
of the value of this insurance is the percentage of premiums returned
to policyholders as benefits, which is called the loss ratio. For
each year from 1988 through 1991, the federal minimum loss ratio
standard for Medigap insurance was 75 percent for policies sold to
groups and 60 percent for policies sold to individuals.\3 These loss
ratio standards are the subject of this report.
--------------------
\1 Medigap insurance is designed specifically to pay deductibles or
coinsurance for Medicare beneficiaries. Our previous reports were
Medigap Insurance: Better Consumer Protection Should Result From
1990 Changes to Baucus Amendment (GAO/HRD-91-49, Mar. 5, 1991) and
Medigap Insurance: Insurers Whose Loss Ratios Did Not Meet Federal
Minimum Standards in 1988-89 (GAO/HRD-92-54, Feb. 28, 1992).
\2 Public Law 101-508, section 4355(a)(5)(A), Nov. 5, 1990.
\3 As discussed in this report, section 4355(a) in OBRA 1990 set the
minimum loss ratio standard for individual policies at 65 percent for
policies sold or issued after November 5, 1991.
RESULTS IN BRIEF
------------------------------------------------------------ Letter :1
From 1988 through 1991, the overall Medigap market grew by more than
50 percent; premiums rose from about $7 billion to $11 billion. In
the first half of the 1988-91 period, Medigap insurers' loss ratios
declined for both individual and group policies. Beginning in 1990,
loss ratios increased, and the 1991 aggregate loss ratios were
approximately at their 1988 levels--80 percent for policies sold to
individuals and 90 percent for group policies. The loss ratios for
individual policies represent a sharp improvement from the early
1980s when the federal minimum standards became effective and
aggregate loss ratios were around 60 percent.
The premiums associated with companies whose aggregate loss ratios
did not meet the federal minimum standards declined from $388 million
in 1988 to $206 million in 1991. While this decline indicates that
insurers' compliance with the loss ratio standards improved during
the 4-year period, some companies did not meet the minimum loss ratio
standards in every state in which they did business. The premiums
collected by these companies steadily declined during the period,
from $126 million in 1988 to $35 million in 1991.
BACKGROUND
------------------------------------------------------------ Letter :2
In 1980, the Congress enacted the Social Security Disability
Amendments of 1980,\4 which added section 1882 to the Social Security
Act. This section, called the Baucus amendment,\5 established
federal minimum standards for marketing and selling Medigap
insurance. The amendment essentially adopted as federal requirements
the standards in a model regulation approved by the National
Association of Insurance Commissioners (NAIC).\6 The amendment also
required that Medigap policies be expected to have loss ratios of at
least 75 percent for group policies and at least 60 percent for
individual policies. If an insurer demonstrated that a policy could
be expected to meet the standard, the insurer had complied with the
requirement regardless of whether its actual loss ratio ever met the
standard.
Since 1980, two relevant legislative changes have directly affected
the sale and regulation of Medigap insurance. The Medicare
Catastrophic Coverage Act of 1988\7 required states to collect actual
Medigap loss ratio data from insurers as a condition for approval of
state regulatory programs. Although the Congress repealed the
Medicare Catastrophic Coverage Act in 1989, it did not repeal the
requirement that states collect actual loss ratio data. OBRA 1990
(1) raised the minimum loss ratio standard for individual policies to
65 percent for policies sold or issued after November 5, 1991; (2)
required companies to report loss ratio data by policy form,
beginning with reports covering 1991 experience; (3) required
insurers whose policy loss ratios do not meet the applicable standard
to give policyholders, beginning in 1994, a refund or credit toward
future premiums so that the policy's recomputed loss ratio, including
the refund or credit, would meet the minimum standards; and (4)
provided for NAIC to develop standards for simplifying and
standardizing Medigap policies.
In July 1991, NAIC revised its standard model act and regulation,
which included the requirements in OBRA 1990. The new model
regulation described 10 standardized Medigap policies, which are the
only ones that can be sold in most states.\8 These changes should
enhance compliance with loss ratio standards, facilitate consumer
understanding of policies, make comparison shopping easier, and
eliminate misleading or confusing provisions. Under OBRA 1990, the
states were effectively given until July 1992 to adopt NAIC's revised
model act and regulation or face the prospect of federal regulation
of Medigap insurance in their jurisdiction. All states except
American Samoa and Guam have approved laws and regulations covering
standardized Medigap plans.\9
When interpreting loss ratios, two important factors to consider are
policy maturity and credibility. Policy maturity refers to the
length of time a policy has been in force. Relatively low loss
ratios may result during the first few years that policies are in
force because (1) claims related to preexisting conditions might not
be covered during the first 6 months and (2) new policyholders may be
fairly healthy and file relatively few claims. As a policy matures,
its loss ratio should present a better indication of long-term policy
performance. Before OBRA 1990, the NAIC loss ratio regulation
applied the minimum standards to policies that had been in force for
3 years or more.\10 OBRA 1990 provided for policies sold or issued
after November 5, 1991, to meet the standards after they have been in
force for 2 years.
Credibility is also an important consideration when interpreting loss
ratios. The standard we used, on the basis of the opinion of a state
actuary who studied this issue for NAIC, is that a loss ratio is
credible if it is based on a number of policyholders sufficient to
generate at least $150,000 in annual premiums in a state.
--------------------
\4 Public Law 96-265, section 507(a), June 9, 1980.
\5 Senator Max Baucus of Montana was the amendment's chief sponsor in
the Senate.
\6 NAIC consists of the heads of the insurance departments of the 50
states, the District of Columbia, and four U.S. territories. NAIC
encourages uniformity and cooperation in insurance regulation among
the states and territories. Among its activities to promote these
goals, NAIC promulgates model insurance laws and regulations for
state consideration and adoption.
\7 Public Law 100-360, section 221(b), July 1, 1988.
\8 "States" in this report includes the 50 states, the District of
Columbia, and the four U.S. territories.
\9 Forty-four states, the District of Columbia, Puerto Rico, and the
Virgin Islands approved the 10 standardized plans. Pennsylvania and
Vermont approved 7; Delaware approved 6; and Minnesota,
Massachusetts, and Wisconsin had alternative simplification programs
in effect when OBRA 1990 was enacted and have waivers from this
requirement.
\10 For policies that had been in force less than 3 years, the
company had to demonstrate that the policy's expected loss ratio in
the third and later policy years would meet the applicable standard.
MOST MEDIGAP BUSINESS IS WITH
POLICIES WHOSE LOSS RATIOS MET
MINIMUM STANDARDS
------------------------------------------------------------ Letter :3
From 1988 through 1991, the nationwide Medigap market in terms of
premiums collected grew by 50 percent, from $7.3 billion in earned
premiums to almost $11 billion by 1991 (in this report all dollars
are reported in current dollars). For mature policies with credible
experience, earned premiums increased more than 90 percent, from $3.7
billion in 1988 to $7.1 billion in 1991 (see fig. 1).
Figure 1: Overall Medigap
Premiums Including Policies
With Mature and Credible
Experience, 1988-91
(See figure in printed
edition.)
The remainder of this report discusses only those policies with
mature and credible experience.
From 1988 through 1989, Medigap insurers' aggregate\11 loss ratios
declined for both individual and group policies; that is, insurers
returned a smaller percentage of premium dollars to policyholders in
1989 than in 1988. In 1990 and 1991, loss ratios gradually increased
for both individual and group policies and for 1991 were
approximately at their 1988 levels (see fig. 2 and app. I for
details).
Figure 2: Medigap Insurers'
Aggregate Loss Ratios on Mature
and Credible Experience,
1988-91
(See figure in printed
edition.)
During the 1988-91 period, Medigap insurers' performance generally
improved. More companies met the minimum loss ratio standards in
1991 than in 1988, and an increased portion of all companies' earned
premiums met the standards (see table 1).
Table 1
Percentage of Medigap Insurers Whose
Aggregate Loss Ratios Met the Minimum
Standards and Their Earned Premiums,
1988-91
Aggregate Percentage
loss ratios Amount of total
met minimum (in earned
Year Total standards Percentage millions) premiums
---------------------- ------ ------------ ---------- ---------- ----------
1988 190 84 44% $3,309 90%
1989 208 117 56 3,899 83
1990 217 143 66 5,902 94
1991 216 154 71 6,873 97
--------------------------------------------------------------------------------
--------------------
\11 Aggregate loss ratios are the sum of benefits paid under all
outstanding policies divided by the sum of premiums. A company could
have loss ratios on some policies below the standards and yet have an
aggregate loss ratio above the standards.
MEDIGAP INSURERS WHOSE LOSS
RATIOS DID NOT MEET MINIMUM
STANDARDS
------------------------------------------------------------ Letter :4
While insurers' performance generally improved, several insurers'
loss ratios did not meet the minimum standards. For some of these
insurers, this poor performance was a long-running problem from 1988
through 1991.
Premiums collected for policies whose loss ratios did not meet the
minimum standards in one or more states declined from $388 million in
1988 to $206 million in 1991. While there was a downward trend over
the 4 years, 1989 was an unusual year, as shown in figure 3.
Figure 3: Premiums for
Insurers Whose Loss Ratios on
Medigap Policies With Mature
and Credible Experience Were
Below Federal Minimum
Standards, 1988-91
(See figure in printed
edition.)
Note: Companies may sell both individual and group insurance and may
have failed to meet the minimum standards in 1 or more years. The
unduplicated count of companies is 106 for 1988, 91 for 1989, 74 for
1990, and 62 for 1991. For the 4 years, it is 163.
The Prudential Insurance Company of America was the largest
contributor to the more than doubling of premiums for policies not
meeting loss ratio standards from 1988 to 1989. Prudential's group
policies failed to meet the standard in 30 states in 1989, up from 6
states in 1988. A company official attributed this to the company's
overestimating claims when premium rates were set for 1989. He said
that estimating claims was complicated by changes in 1989 coverage
required by the Medicare Catastrophic Coverage Act and the company's
decision to change from nationally uniform premiums to regional
premiums for the group policy sold through the American Association
of Retired Persons.
From 1988 through 1991, certain insurers' loss ratios were below the
federal minimum standards in every state in which the company did
business. The premiums collected by these companies declined from
$126 million in 1988 to $35 million in 1991 (see fig. 4). (See app.
II for a list of insurers who sold individual policies and app. III
for a list of insurers who sold group policies.)
Figure 4: Premiums for
Insurers Whose Loss Ratios on
Their Entire Medigap Business
With Mature and Credible
Experience Were Below Minimum
Standards, 1988-91
(See figure in printed
edition.)
Note: Companies may sell both individual and group insurance and may
have failed to meet the minimum standards in 1 or more years. The
unduplicated count of companies is 59 for 1988, 46 for 1989, 31 for
1990, and 18 for 1991. For the 4 years, it is 104.
We identified three companies whose loss ratios for their entire
mature and credible Medigap business were below federal minimum
standards throughout 1988-91. The National Security Life and
Accident Insurance Company collected about $5 million in premiums for
its individual policies for the 4-year period. The other two
companies (Blue Cross and Blue Shield of Oregon and Memphis Hospital
and Surgical Association) sold group policies and collected about $4
million.
LOSS RATIO DATA WILL BE
REPORTED BY POLICY FORM FOR
1991 AND LATER YEARS
------------------------------------------------------------ Letter :5
As required by OBRA 1990, beginning with reports for 1991, insurers
began to report loss ratio information by policy form rather than by
reporting aggregate experience. This type of reporting is more
useful to consumers than aggregate experience reporting because it is
based on the policy form, which is what consumers purchase. OBRA
1990 also required states to maintain loss ratio data covering the
most recent 3 years' experience for policies sold in the state and to
make such information available to interested persons.
The 1991 policy loss ratios show that 145 individual policies\12 sold
in 45 states did not meet the minimum loss ratio standard, and the
insurers collected about $196 million in premiums\13 on these
policies. Also, 37 group policies sold in 36 states did not meet the
minimum loss ratio standard, and these insurers collected about $124
million in premiums. Appendixes IV and V identify the policies with
mature and credible 1991 Medigap loss ratio experience that did not
meet the applicable standard along with their premiums, claims, and
loss ratios. Appendix IV lists individual policies, and appendix V
lists group policies.
--------------------
\12 The actual number of policies (both individual and group) is
greater because some companies combined data for similar policies on
a single experience exhibit.
\13 Premium values reported on a policy form basis (both individual
and group) cannot be compared directly with the aggregate 1991 data
included in earlier sections of this report. Data from 1988-90 were
reported on an aggregate basis, and we aggregated the policy form
data from 1991 to make it comparable to 1988-90 data. In this
section, we summarize performance on a policy form basis; aggregate
summaries tend to overstate the amount of compliance because policies
whose loss ratios are above the standard offset policies whose loss
ratios are below the standard.
OBJECTIVES, SCOPE, AND
METHODOLOGY
------------------------------------------------------------ Letter :6
Our objectives were to (1) identify Medigap insurers' loss ratio
performance during 1990 and 1991 and (2) analyze and compare 1990 and
1991 loss ratio performance with previously reported 1988 and 1989
loss ratio data to identify trends in company performance. Loss
ratios reflect the relationship between premiums charged and benefits
paid\14 under a Medigap policy. We developed the information in this
report from computer databases we obtained from NAIC. NAIC created
the databases from insurance companies' annual Medigap insurance
experience exhibits. We verified the accuracy of NAIC's databases
through separate random samples of each year's loss ratio experience
exhibit for individual states submitted by the insurance companies.
Our verification showed that NAIC accurately transferred loss ratio
data from these exhibits to its computer files.
In our data verification, we identified minor data entry errors that
did not affect our analysis because the errors dealt with immature
business, that is, Medigap policies with less than 3 years'
experience. NAIC corrected all discrepancies.
We did not check the accuracy of the individual reports submitted by
approximately 350 companies reporting Medigap loss ratio information.
Nor did NAIC verify the accuracy of the companies' experience
exhibits.
This review was conducted from October 1992 to August 1993 and,
except as noted above, in accordance with generally accepted
government auditing standards.
--------------------
\14 In this report, the term "premium" means earned premium, which is
the amount of total premiums collected applicable to the calendar
year for which a loss ratio is computed. For example, if a
policyholder paid an annual premium on June 1, only 7 months of that
premium would be earned premium in that calendar year's loss ratio
computation. Earned premiums include premiums due but uncollected in
the current period. Also, benefits are "incurred claims," which is
the amount of claims actually paid plus a reserve for claims incurred
but not yet reported or paid.
---------------------------------------------------------- Letter :6.1
As arranged with your office, unless you publicly announce its
contents earlier, we plan no further distribution of this report
until 7 days after its issue date. At that time, we will send copies
to the Secretary of Health and Human Services, the governors of the
states,\15 other interested parties, and make copies available to
others upon request.
If you have any questions about this report, please call me at (202)
512-7119. Other major contributors to this report are listed in
appendix VI.
Sincerely yours,
Sarah F. Jaggar
Director, Health Financing
and Policy Issues
--------------------
\15 OBRA 1990 requires us to audit compliance with the Medigap loss
ratio requirements at least once every 3 years and to report the
results to the Secretary and the states involved.
THE MEDIGAP MARKET, 1988-91
=========================================================== Appendix I
(Dollars in millions)
Loss Loss Loss Loss
Premiu rati rati rati rati
Type of coverage ms o Premiums o Premiums o Premiums o
------------------ ------ ---- -------- ---- -------- ---- -------- ----
Overall market statistics
--------------------------------------------------------------------------------
Individual $ 79.4 $ 5,543 76.3 $ 7,164 78.7 $ 7,465 80.4
5,158
Group 2,118 95.2 2,581 80.0 2,847 87.6 3,518 89.8
================================================================================
Total $ $ 8,124 $10,011 $10,983
7,276
Mature and credible policies\a
--------------------------------------------------------------------------------
Individual $ 85.6 $ 3,060 81.8 $ 4,323 84.0 $ 4,571 85.9
2,631
Group 1,066 95.7 1,644 82.4 1,924 90.8 2,508 93.4
================================================================================
Total $ $ 4,704 $ 6,247 $ 7,079
3,697
--------------------------------------------------------------------------------
\a A mature policy is at least 3 years old. Credible premium
experience is when at least $150,000 is collected annually on a
policy within a state.
INDIVIDUAL MEDIGAP INSURERS WITH
MATURE AND CREDIBLE AGGREGATE LOSS
RATIO EXPERIENCE BELOW THE MINIMUM
STANDARD FOR 1 OR MORE YEARS
DURING 1988-91
========================================================== Appendix II
(Dollars in thousands)
Number Number
Number of of
Number of of states states
states states where where
where Number where Number policies Number policies Number
policies of policies of were of were of
Company name were sold states Premiums were sold states Premimus sold states Premiums sold states Premiums
------------------ ------------------ -------- -------- --------- -------- -------- -------- -------- -------- -------- -------- --------
All experience below standard for 4 years:
-----------------------------------------------------------------------------------------------------------------------------------------------------
National Security 1 1 $1,654 1 1 $1,205 1 1 $1,240 1 1 $1,006
Life & Accident
Ins. Co.
All experience below standard for 3 years:
-----------------------------------------------------------------------------------------------------------------------------------------------------
Old Surety Life 1 1 253 1 1 172 1 0 0 1 1 1,321
Ins. Co.
Southwest Service 1 1 1,764 1 1 956 1 1 1,266 1 0 0
Life Ins. Co.
Great Republic 1 1 1,539 1 1 1,258 1 1 1,058
Ins. Co.
Time Ins. Co. 1 1 271 1 1 306 1 1 286 1 0 0
All experience below standard for 2 years:
-----------------------------------------------------------------------------------------------------------------------------------------------------
Cincinnati 1 1 278 1 1 799
Equitable Ins.
Co.
American Patriot 1 1 1,201 1 1 2,181 1 0 0 1 0 0
Health Ins. Co.
of NY
American Standard 1 1 1,593 1 1 1,411 1 0 0 1 0 0
Life & Accident
Ins. Co.
Golden State 2 2 769 2 2 1,085 1 0 0 1 0 0
Mutual Life Ins.
Co.
All experience below standard for 1 or more years:
-----------------------------------------------------------------------------------------------------------------------------------------------------
Anthem Life Ins. 1 1 685
Co.
United Farm Bureau 1 0 0 1 1 339
Family Life Ins.
Co.
Aetna Life Ins & 11 4 729 1 1 176
Annuity Co.
American Life & 1 1 9,034 1 0 0
Accident Ins. Co.
Rural Security 1 1 1,505 1 0 0
Life Ins. Co.
Columbia Health 1 1 1,048 1 0 0
Service
Appalachian Life 1 1 527 1 0 0
Ins. Co.
Shelter Life Ins. 1 1 397 1 0 0
Co.
Security Trust 1 1 197
Life Ins. Co.
Atlas Life Ins. 1 1 177
Co.
World Life & 2 1 378 2 2 3,159 2 1 387
Health (L & H)
Ins. Co. of PA
Security General 6 4 1,008 5 5 941 3 2 311
Life Ins. Co.
American 2 2 870 1 0 0 1 0 0
Progressive L & H
Ins. Co. of NY
Great Fidelity 3 2 $642 2 2 $742 3 1 $254 3 1 $500
Life Ins. Co.
Farm & Home Life 1 0 0 2 2 703
Ins. Co.
American Exchange 1 0 0 1 1 647 1 0 0 1 0 0
Life Ins. Co.
Independent Life & 1 1 507 1 1 1,132 1 0 0
Accident Ins. Co.
First United 1 1 463 1 0 0 1 0 0
American Life
Ins. Co.
American Family 2 2 455 3 0 0 4 0 0
Mutual Ins. Co.
Lutheran 1 0 0 1 1 453 1 0 0 4 1 151
Brotherhood
Associated Mutual 1 1 279 1 1 332 1 0 0
Hospital Service
of MI
Sentry Ins. A 4 1 165 1 1 235
Mutual Co.
North American 1 1 165 2 1 183 1 1 245
Ins. Co.
Southland Life 1 1 162 1 0 0 2 1 262
Ins. Co.
Harvest Life Ins. 7 7 5,611 3 2 566 3 1 304 3 0 0
Co.
Liberty National 6 6 4,669 6 0 0
Life Ins. Co.
American Community 1 1 4,310 2 0 0 2 0 0
Mutual Ins. Co.
Presidential Life 1 1 3,084
Ins. Co.
Guarantee Trust 6 6 2,705 6 6 2,031 9 5 1,186 14 0 0
Life Ins. Co.
American Republic 5 5 2,256 8 5 2,605 11 2 632 16 1 199
Ins. Co.
General Life & 1 1 2,021 1 0 0
Accident Ins. Co.
South Atlantic 1 1 1,340
Life Ins. Co.
Pekin Life Ins. 1 1 1,272 1 0 0 1 0 0 1 0 0
Co.
Investors Heritage 1 1 1,067
Life Ins. Co.
Eastern Ins. Co. 1 1 984
United Teacher 1 1 929 1 0 0 2 0 0 3 0 0
Associates Ins.
Co.
American Travelers 1 1 782 2 0 0 3 0 0 5 1 334
Life Ins. Co.
Pilgrim Life Ins. 1 1 757 1 0 0
Co.
Jefferson Life 1 1 737 1 0 0 1 0 0 1 0 0
Ins. Co.
Academy Life Ins. 1 1 711 1 0 0 1 0 0 1 0 0
Co.
Benefit Trust Life 2 2 $549 3 3 $747 3 1 $170 3 1 $180
Ins. Co.
American Sun Life 1 1 461
Ins. Co.
Peoples Life Ins. 1 1 394 1 0 0 1 0 0 1 0 0
Co. of SC
Combined 1 1 343 1 0 0 1 0 0 1 0 0
Underwriters Life
Ins. Co.
National Benefit 1 1 311 1 0 0
Life Ins. Co.
United Security 1 1 194 1 0 0 1 0 0
Assurance Co. of
PA
CareAmerica Life 1 1 187 1 0 0 1 1 255 1 0 0
Ins. Co.
Vulcan Life Ins. 1 1 177
Co.
United Family Life 1 1 175 1 1 236 1 0 0 3 1 374
Ins. Co.
Legal Security 1 1 160
Life Ins. Co.
American Teachers 1 1 152
Life Ins. Co.
First Continental 1 1 151
Life & Accident
Ins. Co.
National Health 1 1 150
Ins. Co.
Some experience below standard in 1988-91:
-----------------------------------------------------------------------------------------------------------------------------------------------------
Mutual of Omaha 48 14 12,442 48 19 26,564 47 26 60,658 46 20 30,843
Ins. Co.
United American 20 9 30,276 41 26 70,092 41 9 24,254 41 9 20,309
Ins. Co.
Union Fidelity 34 13 13,835 35 23 22,845 35 16 15,992 35 20 17,474
Life Ins. Co. of
Trevose
Bankers Life & 44 26 74,539 44 33 102,257 45 9 8,535 46 6 11,398
Casualty Co.
National Home Life 25 4 3,081 28 1 544 32 7 6,443 34 9 8,436
Assurance Co.
National Financial 2 1 2,604 2 0 0 15 0 0 18 6 5,189
Ins. Co.
Statesman National 9 4 3,401 9 3 898 9 7 5,007
Life Ins. Co.
Central States H & 10 7 5,963 12 6 2,751 14 1 155 20 6 4,570
L Co. of Omaha
New York Life Ins. 29 13 3,187 27 5 1,506 29 12 3,808
Co.
Pyramid Life Ins. 20 10 8,235 18 12 5,786 17 6 3,408 17 6 3,047
Co.
American Family 11 2 387 20 4 2,475
Life Assurance
Co. of Columbus,
GA
Union Bankers Ins. 2 0 0 12 5 1,096 22 8 3,507 24 4 2,033
Co.
Bankers Fidelity 7 2 6,278 7 3 7,112 8 3 4,962 7 3 1,476
Life Ins. Co.
World Ins. Co. 9 0 $0 9 2 $1,167 10 4 $1,876 8 2 $1,391
Gulf Life Ins. Co. 5 0 0 6 5 3,140 6 3 1,396 11 2 1,144
American Integrity 8 4 1,571 10 4 2,223 12 5 1,390 12 4 1,137
Ins. Co.
Colonial Penn 1 0 0 21 7 3,204 20 0 0 19 3 1,011
Franklin Ins. Co.
Combined Ins. Co. 5 3 646
of America
American Ins. Co. 2 1 589 2 0 0 2 0 0 2 1 576
of TX
Associated Doctors 10 3 2,101 10 8 6,250 10 3 1,744 11 1 554
H & L Ins. Co.
Georgia L & H Ins. 4 2 1,052 3 0 0 3 0 0 5 1 445
Co.
Globe Life & 14 6 3,617 27 9 6,489 26 7 3,478 25 2 372
Accident Ins. Co.
Equitable Life & 15 0 0 15 1 352
Casualty Ins. Co.
National 13 6 1,752 15 8 3,577 15 6 1,465 13 2 345
Foundation Life
Ins. Co.
Physicians Mutual 16 7 4,593 25 5 4,738 31 0 0 33 1 334
Ins. Co.
Mutual Protective 5 4 1,041 5 2 375 5 0 0 10 1 310
Ins. Co.
Continental 3 0 0 4 1 188 4 0 0 6 1 278
General Ins. Co.
Atlantic American 12 1 1,892 12 2 1,959 11 7 6,150 11 1 228
Life Ins. Co.
Federated 5 3 624 2 1 224
Investors Life
Ins. Co./
American Combined
Life Ins. Co.\b
American National 3 1 195 3 1 564 3 0 0 3 1 190
Ins. Co.
Life Ins. Co. of 7 0 0 9 1 180
GA
Continental 10 2 1,488 14 2 1,455 13 1 169
Casualty Co.
American General 18 3 1,217 19 6 4,321 19 12 16,234 19 0 0
Life & Accident
Ins. Co.
Reserve National 7 5 1,942 11 9 3,296 10 6 2,649 15 0 0
Ins. Co.
Federal Home Life 13 11 25,756 11 7 4,961 11 2 1,602 11 0 0
Ins. Co.
National States 14 4 1,384 12 0 0
Ins. Co.
Principal Mutual 2 1 1,318
Life Ins. Co.
Pioneer Life Ins. 9 5 4,944 10 7 5,552 28 2 1,106 31 0 0
Co. of IL
Life & Casualty 6 1 710 6 4 1,577 6 3 1,049
Ins. Co. of TN
Guardian Life Ins. 3 1 203
Co. of America
Mid South Ins. Co. 2 1 169 2 0 0 2 1 162
Reserve Life Ins. 14 5 $2,888 16 6 $3,310
Co.
National Casualty 13 7 1,748 10 7 1,947 7 0 $0 5 0 $0
Co.
Medico Life Ins. 3 1 167 3 2 761 4 0 0 4 0 0
Co.
Acceleration Life 2 0 0 2 1 440 1 0 0 1 0 0
Ins. Co.
United Founders 2 1 389
Life Ins. Co.
Golden Rule Ins. 5 0 0 5 2 340 12 0 0 16 0 0
Co.
Kanawha Ins. Co. 2 0 0 2 1 286 2 0 0 2 0 0
Old American Ins. 7 1 150 4 1 281 3 0 0 3 0 0
Co.
Nationwide Life 5 4 1,227 3 1 217 4 0 0 5 0 0
Ins. Co.
Old Southern Life 3 1 329 3 1 204 4 0 0
Ins. Co.
Legacy Life Ins. 7 4 3,226
Co.
Mountain States 3 1 1,263 1 0 0
Life Ins. Co. of
America
Hill Country Life 2 1 534 1 0 0
Ins. Co.
Standard Life & 13 1 372 19 0 0 22 0 0 24 0 0
Accident Ins. Co.
Bankers Multiple 3 2 339 1 0 0 1 0 0 1 0 0
Line Ins. Co.
State Farm Mutual 32 2 326 35 0 0 38 0 0 39 0 0
Automobile Ins.
Co.
U.S. Guardian 2 1 174 1 0 0
Health Ins. Co.
Lincoln Life & 2 1 171 1 0 0
Casualty Co.
=====================================================================================================================================================
Totals $271,462 $333,426 $198,596 $132,518
-----------------------------------------------------------------------------------------------------------------------------------------------------
\a In calendar year 1991, companies were required to report loss
ratio information by policy form. For our analyses we aggregated the
1991 premiums and claims to make the loss ratio information
consistent with data reported in calendar years 1988 through 1990.
As a result, the information in appendix IV, which includes loss
ratios by policy form for calendar year 1991, cannot be directly
compared with information in this appendix.
\b Name changed in 1991.
Shading shows that the company either did not do business or had no
mature and credible business.
GROUP MEDIGAP INSURERS WITH MATURE
AND CREDIBLE AGGREGATE LOSS RATIO
EXPERIENCE BELOW THE MINIMUM
STANDARD FOR 1 OR MORE YEARS
DURING 1988-91
========================================================= Appendix III
(Dollars in thousands)
Number Number
Number of of
Number of of states states
states states where where
where Number where Number policies Number policies Number
policies of policies of were of were of
Company name were sold states Premiums were sold states Premiums sold states Premiums sold states Premiums
------------------ ------------------ -------- -------- --------- -------- -------- -------- -------- -------- -------- -------- --------
All experience below standard for 4 years:
-----------------------------------------------------------------------------------------------------------------------------------------------------
Blue Cross & Blue 1 1 $481 1 1 $505 1 1 $606 1 1 $1,124
Shield of OR
Memphis Hospital 1 1 301 1 1 195 1 1 220 1 1 307
Service &
Surgical Assn.
All experience below standard for 3 years:
-----------------------------------------------------------------------------------------------------------------------------------------------------
Life Investors 5 5 961 8 8 1,950 8 8 1,983
Ins. Co. of
America
King County 1 1 1,885 1 1 1,415 1 1 1,637
Medical Blue
Shield
Continental 3 3 685 2 2 467 2 0 0 1 1 1,043
Casualty Co.
New Mexico Blue 1 1 1,053 1 1 723 1 1 623
Cross & Blue
Shield
Blue Cross & Blue 1 1 3,245 1 1 3,156 1 1 3,363 1 0 0
Shield of MN
Blue Cross & Blue 1 1 2,195 1 1 1,927 1 1 1,620 1 0 0
Shield United of
WI
Ins. Co. of North 1 1 817 1 1 764 3 3 1,143
America
American General 1 1 2,031 1 1 1,250 1 1 906
Group Ins. Co./
Anthem Life Ins.
Co.\b
National Casualty 2 2 986 3 3 1,032 1 1 186 1 0 0
Co.
All experience below standard for 2 years:
-----------------------------------------------------------------------------------------------------------------------------------------------------
Calfarm Life Ins. 1 1 3,440 1 1 3,735 1 0 0 1 0 0
Co.
Continental 2 2 708 3 3 981
American Life
Ins. Co.
Life Ins. Co. of 2 2 1,616 1 1 170
North America
Harvest Life Ins. 5 5 3,511 1 1 242 1 0 0 1 0 0
Co.
Blue Cross & Blue 1 1 13,901 1 1 15,192
Shield of KY
All experience below standard for 1 year:
-----------------------------------------------------------------------------------------------------------------------------------------------------
North American 5 4 5,146 4 3 13,656 4 1 13,870 2 2 16,782
Life & Casualty
Mountain State 1 0 0 1 1 2,986
Blue Cross & Blue
Shield
Blue Cross & Blue 1 0 0 1 1 2,566
Shield of ND
Blue Cross & Blue 1 1 $925
Shield Plan of NV
Klamath Medical 1 1 208
Service Bureau
Blue Cross & Blue 1 1 $30,321 1 0 0
Shield of CT
Guarantee Trust 1 1 16,894
Life Ins. Co.
Associated 1 1 6,608 1 0 0
Hospital Service
of ME
Community Mutual 1 1 2,948
Ins. Co.
Preferred Life 1 1 1,055 1 0 0
Ins. Co. of NY
Blue Cross & Blue 1 1 511
Shield of MT
Blue Cross of ID 1 1 308
Health Service
Acceleration Life 1 1 169
Ins. Co.
Blue Cross & Blue 1 1 $30,083 1 0 0
Shield of AL
Blue Cross of 1 1 10,945 1 0 0 1 0 0
Western NY
Blue Cross & Blue 1 1 4,031 1 0 0 1 0 0
Shield of NH
Blue Cross & Blue 1 1 1,518 1 0 0 1 0 0
Shield of MS
Blue Cross & Blue 1 1 869
Shield of MD
Blue Cross & Blue 1 1 200
Shield of Kansas
City
Provident Life & 12 12 $14,279 19 0 0 28 23 10,851 20 9 3,506
Accident Ins. Co.
Blue Shield of IA 1 1 13,440
Group Health 1 1 13,012
Service of OK
Corporate Life 1 1 2,229
Ins. Co.
Provident Life & 1 1 995 1 0 0 1 0 0 1 0 0
Casualty Ins. Co.
Federal Life Ins. 1 1 518
Co.
Principal Mutual 2 2 333 13 12 32,369 14 13 36,137 16 14 34,022
Life Ins. Co.
United Security 1 1 287 1 0 0
Assurance Co. of
PA
Providers Fidelity 1 1 $165
Life Ins. Co.
Some experience below standard, 1988-91:
-----------------------------------------------------------------------------------------------------------------------------------------------------
Prudential Ins. 52 6 12,223 53 30 $327,867 53 2 $2,436 53 4 $3,760
Co. of America
Monumental General 15 12 5,208 17 12 5,326 22 14 8,319 23 4 1,154
Ins. Co./Toyota
Motor Life Ins.
Co.\c
USAA Life Ins. Co. 13 0 0 17 1 616
Hartford Life Ins. 39 1 165
Co.
Mutual Life Ins. 5 3 5,218 8 4 5,156 8 3 4,587
Co. of NY
Hartford Accident 41 8 6,614 38 0 0
& Indemnity Co.
Colonial Penn 25 16 7,544
Franklin Ins. Co.
Nationwide Life 2 1 1,001 2 0 0 2 0 0 2 0 0
Ins. Co.
=====================================================================================================================================================
Totals $116,567 $471,820 $146,425 $73,410
-----------------------------------------------------------------------------------------------------------------------------------------------------
\a In calendar year 1991, companies were required to report loss
ratio information by policy form. For our analyses we aggregated the
1991 premiums and claims to make the loss ratio information
consistent with data reported in calendar years 1988 through 1990.
As a result, the information in appendix V, which includes loss
ratios by policy form for calendar year 1991, cannot be directly
compared with information in this appendix.
\b Name changed in 1990.
\c Name changed in 1991.
Shading shows that the company either did not do business or had no
mature and credible business.
MEDIGAP INSURERS WITH MATURE AND
CREDIBLE LOSS RATIO EXPERIENCE ON
INDIVIDUAL POLICIES BELOW THE
MINIMUM STANDARD, 1991
========================================================== Appendix IV
Loss
rati
State Company name Policy number Premiums Claims o
---------------- -------------------------------------- -------------- ---------- -------- ----
AL Associated Doctors Health & Life (H & 380 $484,065 $273,673 56.5
L) Ins. Co.
Bankers Life & Casualty Co. GR-75R 700,779 371,626 53.0
Mutual of Omaha Ins. Co. M2 \a 299,502 172,072 57.5
AR Mutual of Omaha Ins. Co. M6 \a 187,873 92,795 49.4
Pyramid Life Ins. Co. G-10 239,305 132,488 55.4
H-91 181,081 65,727 36.3
H-94 223,327 105,031 47.0
Statesman National Life Ins. Co. MED484 185,038 98,520 53.2
P-193, P-222 324,486 23,376 7.2
\a
AZ Mutual of Omaha Ins. Co. 15/16CMO \a 203,719 120,700 59.2
Union Fidelity Life Ins. Co. of 1053 261,445 145,028 55.5
Trevose
CA American Integrity Ins. Co. MS-85 294,930 171,854 58.3
Anthem Life Ins. Co. 40071 684,891 405,202 59.2
Blue Cross of CA 442 1,229,000 734,000 59.7
Mutual of Omaha Ins. Co. M1/M65 \a 447,369 148,497 33.2
M3/M67,H64 \a 354,926 177,627 50.0
2CMO \a 1,007,225 415,897 41.3
50VB/51VB/ 1,503,636 806,109 53.6
52VB \a
National Home Life Assurance Co. GSH-1 1,301,958 618,135 47.5
Statesman National Life Ins. Co. P-305 172,587 93,369 54.1
Union Fidelity Life Ins. Co. of 8550 817,208 446,295 54.6
Trevose
CO Mutual of Omaha Ins. Co. C23M/C24M \a 221,355 113,910 51.5
M1 \a 159,350 80,264 50.4
M2 \a 774,432 457,993 59.1
15/16CMO \a 270,555 124,674 46.1
50VB/51VB/ 240,633 136,832 56.9
52VB \a
Union Fidelity Life Ins. Co. of 1053 174,814 88,559 50.7
Trevose
United American Ins. Co. MAXC 404,411 217,296 53.7
DC National Home Life Assurance Co. NH1380 150,397 63,650 42.3
FL American Family Life Assurance Co. of A-19800 188,028 108,198 57.5
Columbus, GA
Central States H & L Co. of Omaha 533 236,798 129,774 54.8
Life Ins. Co. of GA 6610 724,915 409,341 56.5
Mutual of Omaha Ins. Co. M1 \a 330,365 167,792 50.8
M3 \a 203,958 109,913 53.9
GA Mutual of Omaha Ins. Co. M1/M7 \a 234,613 116,144 49.5
M2 \a 585,291 333,798 57.0
National Financial Ins. Co. GL65 309,340 140,546 45.4
New York Life Ins. Co. 8145 267,787 130,462 48.7
United American Ins. Co. MVXC 187,831 107,017 57.0
HI Bankers Life & Casualty Co. GR-75R 327,531 136,929 41.8
IA American Family Life Assurance Co. of A-19800 248,890 125,048 50.2
Columbus, GA
Bankers Life & Casualty Co. GR-75R 13,039,374 7,728,39 59.3
3
Mutual of Omaha Ins. Co. M1 \a 325,129 159,137 48.9
M3/M51/H64 \a 423,879 224,596 53.0
15/16CMO \a 290,704 171,741 59.1
2/3CMO,20/22 189,888 87,909 46.3
\a
50VB/51VB/ 237,947 103,566 43.5
52VB \a
National Foundation Life Ins. Co. MS100 150,828 75,146 49.8
New York Life Ins. Co. 8145 413,318 178,471 43.2
Physicians Mutual Ins. Co. P197 473,987 283,080 59.7
Union Fidelity Life Ins. Co. of 1053 164,953 62,276 37.8
Trevose
8550 154,599 89,087 57.6
United American Ins. Co. MAXC 583,270 291,106 49.9
MMS 973,512 527,862 54.2
World Ins. Co. A2485 165,413 98,120 59.3
ID Union Bankers Ins. Co. 86M 273,864 161,659 59.0
United American Ins. Co. MAXC 156,882 84,412 53.8
MAXC+ 239,942 136,887 57.1
IL Bankers Life & Casualty Co. CR-93T 464,689 272,503 58.6
Central States H & L Co. of Omaha 286 233,923 119,567 51.1
Continental Casualty Co. P1-56566 256,037 142,183 55.5
Mutual of Omaha Ins. Co. M1 \a 657,342 389,005 59.2
2/3/30/31CMO 746,819 397,150 53.2
\a
50VB/51VB/ 850,177 487,335 57.3
52VB \a
National Casualty Co. 4006 188,271 95,769 50.9
National Home Life Assurance Co. GSH-1 535,567 308,727 57.6
New York Life Ins. Co. 8145 491,238 284,456 57.9
Union Fidelity Life Ins. Co. of 1053 520,740 307,821 59.1
Trevose
8350 568,095 318,548 56.1
8550 315,964 184,660 58.4
United American Ins. Co. DMXC-U 569,189 313,209 55.0
MAXC 4,120,392 2,456,83 59.6
0
MVXC 205,239 114,884 56.0
IN Associated Doctors H & L Ins. Co. 350 301,911 176,751 58.5
380 208,411 113,596 54.5
Combined Ins. Co. of America 8081 200,762 118,442 59.0
Globe Life & Accident Ins. Co. MCP-3 217,243 127,375 58.6
Great Fidelity Life Ins. Co. 7340 & 6135 \a 373,993 201,788 54.0
Mutual of Omaha Ins. Co. M1 \a 213,356 119,738 56.1
National Home Life Assurance Co. NH1380 997,486 569,524 57.1
Union Bankers Ins. Co. 86M 864,002 489,758 56.7
Union Fidelity Life Ins. Co. of 1042 251,478 125,867 50.1
Trevose
1053 437,819 175,049 40.0
8541 309,408 153,858 49.7
8550 373,827 222,781 59.6
United Farm Bureau Family Life Ins. 1 338,892 201,666 59.5
Co.
KS Mutual of Omaha Ins. Co. M4/M86,HM17 \a 410,629 191,741 46.7
50VB/51VB/ 202,138 107,117 53.0
52VB \a
United American Ins. Co. MAXC 645,517 318,045 49.3
MAXC+ 653,791 338,934 51.8
MMS 1,324,645 736,074 55.6
KY American Republic Ins. Co. A-2721 150,285 89,319 59.4
Associated Doctors H & L Ins. Co. 380 441,154 235,313 53.3
Mutual of Omaha Ins. Co. M2 \a 554,743 240,487 43.4
M4,HM17 \a 256,237 152,727 59.6
National Financial Ins. Co. GL65-4 188,433 94,747 50.3
Physicians Mutual Ins. Co. P192 316,421 167,014 52.8
Pyramid Life Ins. Co. H-94 260,886 134,256 51.5
LA Atlantic American Life Ins. Co. MS2083 227,774 136,545 59.9
Bankers Life & Casualty Co. CR-93T 214,249 126,980 59.3
Central States H & L Co. of Omaha 286 289,288 163,336 56.5
Mutual of Omaha Ins. Co. 2/3CMO,20/22 261,095 141,119 54.0
\a
50VB/51VB/ 309,074 126,615 41.0
52VB \a
New York Life Ins. Co. 8145 778,662 379,298 48.7
Statesman National Life Ins. Co. P-376,P-376R 201,218 120,387 59.8
\a
P305,P378,P373 165,953 89,779 54.1
\a
United American Ins. Co. MC7 217,779 129,386 59.4
MA Blue Cross & Blue Shield of MA MXLO 555,085 302,426 54.5
Mutual of Omaha Ins. Co. C23M/C24M \a 155,585 92,912 59.7
M17 \a 168,848 98,815 58.5
2/3/4/23/ 178,768 103,092 57.7
24CMO \a
National Home Life Assurance Co. NH 910 361,621 180,849 50.0
MD American Integrity Ins. Co. MMS-84 158,789 57,662 36.3
Bankers Life & Casualty Co. GR-73S 186,281 86,209 46.3
Mutual of Omaha Ins. Co. 2/3/34/35CMO 193,342 110,214 57.0
\a
50VB/51VB/ 186,317 102,756 55.2
52VB \a
ME American Travelers Life Ins. Co. WLH-54 305,611 174,285 57.0
MI National Home Life Assurance Co. NH 910 154,089 86,215 56.0
MN American Family Life Assurance Co. of A-19800 679,140 298,317 43.9
Columbus, GA
Continental General Ins. Co. 316 370,754 209,286 56.4
Mutual of Omaha Ins. Co. M1/M21 \a 159,256 69,694 43.8
M2/M22/M92 \a 1,162,975 649,610 55.9
50VB/51VB/ 234,674 126,001 53.7
52VB \a
MO American National Ins. Co. GMS-6 189,953 80,211 42.2
American Republic Ins. Co. A-2721 673,045 400,260 59.5
Associated Doctors H & L Ins. Co. 380 179,535 104,181 58.0
Blue Cross & Blue Shield of MO MC-1 643,589 355,265 55.2
UC-24 21,736,241 10,850,8 49.9
66
Central States H & L Co. of Omaha 286 425,840 237,052 55.7
Mutual of Omaha Ins. Co. M1/M75 \a 267,634 101,493 37.9
M2/M76 \a 783,999 404,314 51.6
M4/M78 \a 618,669 332,387 53.7
15/16CMO \a 453,036 232,162 51.2
2/3/4CMO,20/ 646,144 317,240 49.1
22 \a
50VB/51VB/ 596,759 303,650 50.9
52VB \a
Physicians Mutual Ins. Co. P197 171,050 88,780 51.9
Pyramid Life Ins. Co. G-10 271,020 144,635 53.4
Union Fidelity Life Ins. Co. of 1042 349,839 187,443 53.6
Trevose
1053 1,070,597 534,834 50.0
8550 258,051 142,249 55.1
United American Ins. Co. MBXC 205,026 115,044 56.1
World Ins. Co. A2480 852,521 420,644 49.3
A2485 158,557 52,092 32.9
MS Associated Doctors H & L Ins. Co. 380 860,692 503,410 58.5
Bankers Life & Casualty Co. CR-93T 164,874 90,245 54.7
Gulf Life Ins. Co. MED-1 232,356 101,675 43.8
New York Life Ins. Co. 8145 235,015 120,971 51.5
Union Fidelity Life Ins. Co. of 1042 233,528 130,314 55.8
Trevose
8550 262,476 148,395 56.5
United American Ins. Co. MAXC+ 803,358 397,730 49.5
MT Equitable Life & Casualty Ins. Co. 700 317,911 177,714 55.9
Mutual of Omaha Ins. Co. M2 \a 157,611 92,446 58.7
M4,HM25 \a 269,905 128,622 47.7
NC Bankers Fidelity Life Ins. Co. MS1083 808,485 460,529 57.0
Bankers Life & Casualty Co. GR-73S 683,621 381,046 55.7
Blue Cross & Blue Shield of NC M145 299,012 135,033 45.2
M148 13,086,411 7,106,68 54.3
4
M3 226,687 118,026 52.1
Globe Life & Accident Ins. Co. MCP-3 392,324 214,256 54.6
Mutual of Omaha Ins. Co. M27 \a 238,213 132,862 55.8
M28 \a 598,331 324,154 54.2
M30,HM17\a 184,405 79,173 42.9
11/12CMO,20/ 217,218 92,484 42.6
22 \a
50VB/51VB/ 634,923 359,385 56.6
52VB \a
National Financial Ins. Co. GL65 303,333 168,685 55.6
MG-82 188,345 100,133 53.2
MS(86)R 392,111 229,432 58.5
National Home Life Assurance Co. NH 910 259,767 147,828 56.9
NH1380 2,384,109 1,426,46 59.8
8
New York Life Ins. Co. 8145 310,895 179,601 57.8
Union Fidelity Life Ins. Co. of 1053 1,062,495 543,004 51.1
Trevose
United American Ins. Co. MBXC 181,451 101,867 56.1
MMS 1,819,947 915,451 50.3
United Family Life Ins. Co. AA31 355,494 182,379 51.3
World Ins. Co. A2480 424,436 251,876 59.3
ND Mutual of Omaha Ins. Co. M2 \a 248,285 117,778 47.4
United American Ins. Co. MAXC 639,383 291,065 45.5
MAXC+ 657,200 378,092 57.5
NE Bankers Life & Casualty Co. GR-75R 3,177,743 1,742,60 54.8
3
Central States H & L Co. of Omaha 286 583,661 243,575 41.7
Continental General Ins. Co. 314 229,683 119,269 51.9
Mutual of Omaha Ins. Co. C23M/C24M \a 204,743 104,680 51.1
M1 \a 160,609 60,781 37.8
M2 \a 728,779 371,154 50.9
M3,H64 \a 230,094 93,159 40.5
M4,HM17 \a 969,234 558,900 57.7
15/16CMO \a 210,022 86,714 41.3
2/3/4/30/ 235,259 100,217 42.6
31CMO \a
50VB/51VB/ 302,380 145,814 48.2
52VB \a
Mutual Protective Ins. Co. 487 185,747 83,883 45.2
National Foundation Life Ins. Co. MS100 179,331 98,729 55.1
National Home Life Assurance Co. GSH-1 190,608 113,179 59.4
New York Life Ins. Co. 8145 208,047 79,514 38.2
Union Fidelity Life Ins. Co. of 1053 212,770 84,116 39.5
Trevose
United American Ins. Co. MAXC 308,825 178,082 57.7
MAXC+ 831,226 383,715 46.2
MMS 1,092,647 616,598 56.4
World Ins. Co. A2485 235,068 127,820 54.4
NJ Colonial Penn Franklin Ins. Co. 10-82-460 337,046 196,982 58.4
National Home Life Assurance Co. NH 910 466,818 262,120 56.2
NH1380 1,137,591 634,745 55.8
Union Fidelity Life Ins. Co. of 1042 211,778 91,959 43.4
Trevose
1053 443,386 208,943 47.1
8550 496,424 241,919 48.7
NM Bankers Fidelity Life Ins. Co. MS1083 199,646 116,113 58.2
National Home Life Assurance Co. NH1380 252,680 117,411 46.5
Union Fidelity Life Ins. Co. of 1053 153,956 73,759 47.9
Trevose
United American Ins. Co. MAXC+ 348,977 191,363 54.8
NV New York Life Ins. Co. 8145 186,428 95,815 51.4
NY Aetna Life Insurance & Annuity Co. 24310 175,602 77,166 43.9
Colonial Penn Franklin Ins. Co. 10-82-316 274,422 141,628 51.6
First United American Life Ins. Co. NY-MAXC 271,111 136,584 50.4
OH Acceleration Life Ins. Co. AMSP-511 444,742 252,559 56.8
American Family Life Assurance Co. of A-19800 190,621 112,801 59.2
Columbus, GA
Central States H & L Co. of Omaha 286 473,733 242,515 51.2
Mutual of Omaha Ins. Co. 15/16CMO \a 396,511 224,174 56.5
National Home Life Assurance Co. NH 910 442,133 237,079 53.6
Union Fidelity Life Ins. Co. of 1053 1,087,598 556,180 51.1
Trevose
8550 526,472 305,807 58.1
OK Globe Life & Accident Ins. Co. MCP-3 267,287 153,721 57.5
Mutual of Omaha Ins. Co. M2/M112 \a 1,473,297 749,847 50.9
M4/M114 \a 693,682 353,904 51.0
50VB/51VB/ 192,331 89,885 46.7
52VB \a
New York Life Ins. Co. 8145 175,818 63,716 36.2
Old Surety Life Ins. Co. MS 1,321,278 758,574 57.4
Union Fidelity Life Ins. Co. of 1042 202,263 111,002 54.9
Trevose
United American Ins. Co. DMXC-U 169,916 80,910 47.6
MAXC+ 790,530 443,828 56.1
MMS 1,337,470 726,649 54.3
OR Mutual of Omaha Ins. Co. M94 \a 502,470 290,676 57.8
M96,HM17 \a 279,313 152,179 54.5
50VB/51VB/ 177,141 74,785 42.2
52VB \a
Pyramid Life Ins. Co. G-10 177,631 101,089 56.9
United American Ins. Co. MAXC 1,046,848 590,270 56.4
MAXC+ 1,577,046 834,541 52.9
MMS 1,695,293 958,054 56.5
PA National Home Life Assurance Co. NH 910 388,639 231,738 59.6
NH1190 240,038 130,786 54.5
SC Independent Life & Accident Ins. Co. MCS 101 171,313 87,515 51.1
Liberty Life Ins. Co. 892 163,573 95,789 58.6
Life Ins. Co. of GA 6612 251,463 121,100 48.2
New York Life Ins. Co. 8145 160,196 88,156 55.0
SD Bankers Life & Casualty Co. GR-75R 1,046,789 614,603 58.7
United American Ins. Co. MAXC 365,240 216,330 59.2
TN American Family Life Assurance Co. of A-19800 324,046 181,437 56.0
Columbus, GA
Continental Life Ins. Co. of Brentwood SSC85 952,953 567,951 59.6
Georgia H & L Ins. Co. 803 221,520 128,423 58.0
Life Ins. Co. of GA 6612 194,099 80,961 41.7
Mutual of Omaha Ins. Co. M2 \a 544,564 278,759 51.2
M4,HM30 \a 248,508 132,507 53.3
2/3/30CMO,20 242,801 139,001 57.2
\a
50VB/51VB/ 191,319 64,527 33.7
52VB \a
National Home Life Assurance Co. GSH-1 197,774 103,550 52.4
Pyramid Life Ins. Co. G-10 356,582 178,481 50.1
H-94 530,828 239,604 45.1
Union Fidelity Life Ins. Co. of 1042 257,410 147,531 57.3
Trevose
1053 588,226 346,047 58.8
TX American Ins. Co. of TX AMS78 575,644 332,397 57.7
American Integrity Ins. Co. MS-7/8 \a 166,860 84,886 50.9
MS-85 210,784 106,932 50.7
American Life & Accident Ins. Co. A-MAXC+ 685,432 379,390 55.4
AL-02 258,631 151,506 58.6
AL-100 3,372,259 1,984,10 58.8
1
S30 164,486 91,795 55.8
S35 1,053,020 617,973 58.7
Central States H & L Co. of Omaha 286 601,746 309,291 51.4
Mutual of Omaha Ins. Co. 15/16CMO \a 895,000 492,821 55.1
2/3CMO,20AGHO 920,878 548,091 59.5
\a
50VB/51VB/ 1,035,199 489,158 47.3
52VB \a
National Financial Ins. Co. PMS86 180,616 87,372 48.4
National Security Life & Accident Ins. SC 394,632 176,316 44.7
Co.
Statesman National Life Ins. Co. P-181 1,041,417 548,365 52.7
P305,P306,P297 854,361 462,204 54.1
\a
Union Bankers Ins. Co. 76M 398,084 227,499 57.1
Union Fidelity Life Ins. Co. of 8350 584,907 343,511 58.7
Trevose
UT Blue Cross & Blue Shield of UT B883650013007 360,507 200,606 55.6
B883650013012 347,052 151,277 43.6
Mutual of Omaha Ins. Co. M4,HM17 \a 150,620 85,591 56.8
United American Ins. Co. MAXC+ 228,679 103,778 45.4
VA American Family Life Assurance Co. of A-19800 336,920 154,074 45.7
Columbus, GA
Globe Life & Accident Ins. Co. MCP-3 342,517 200,979 58.7
MCP-4 168,579 75,367 44.7
Gulf Life Ins. Co. MED-1 650,606 389,509 59.9
Mutual of Omaha Ins. Co. M3/M71,H64 \a 154,246 78,896 51.1
M35 \a 288,761 130,657 45.2
M4/M72 \a 406,911 226,962 55.8
National Financial Ins. Co. GL65-4 184,452 65,316 35.4
New York Life Ins. Co. 8145 237,932 111,002 46.7
Pyramid Life Ins. Co. G-10 158,414 69,690 44.0
H-94 158,368 69,398 43.8
Union Fidelity Life Ins. Co. of 1042 229,526 105,168 45.8
Trevose
1053 640,848 340,428 53.1
8550 467,719 277,229 59.3
United American Ins. Co. MAXC+ 1,048,058 574,581 54.8
WA Bankers Fidelity Life Ins. Co. MS1083 467,429 261,658 56.0
Bankers Life & Casualty Co. GR-75R 3,629,420 2,042,71 56.3
8
Central States H & L Co. of Omaha 286 164,348 96,112 58.5
National Home Life Assurance Co. NH1380 437,657 251,641 57.5
New York Life Ins. Co. 8145 291,217 159,895 54.9
Union Fidelity Life Ins. Co. of 1053 166,903 78,597 47.1
Trevose
WI American Family Life Assurance Co. of A-19700 186,809 86,653 46.4
Columbus, GA
A-19800 639,370 338,905 53.0
Central States H & L Co. of Omaha 286 1,899,728 1,105,46 58.2
5
Mutual of Omaha Ins. Co. M40,HM26 \a 1,951,117 1,159,89 59.4
5
50/51CMO \a 246,761 133,321 54.0
North American Ins. Co. 400 170,616 63,099 37.0
United American Ins. Co. DMXC-U 234,474 132,191 56.4
WV Mutual of Omaha Ins. Co. M1/M79 \a 165,663 89,440 54.0
50VB/51VB/ 188,463 109,779 58.2
52VB \a
Union Fidelity Life Ins. Co. of 1053 320,375 166,225 51.9
Trevose
WY Bankers Life & Casualty Co. GR-75R 464,925 219,913 47.3
United American Ins. Co. MAXC+ 310,343 157,476 50.7
====================================================================================================
Totals $195,984,1 $105,185
56 ,275
----------------------------------------------------------------------------------------------------
\a Companies included data for similar policies on a single
experience exhibit.
MEDIGAP INSURERS WITH MATURE AND
CREDIBLE LOSS RATIO EXPERIENCE ON
GROUP POLICIES BELOW THE MINIMUM
STANDARD, 1991
=========================================================== Appendix V
St Loss
at rati
e Company name Policy number Premiums Claims o
-- ---------------------------- ---------------- ------------ ---------- ----
AL North American Life & GSC-1300 $209,187 $110,924 53.0
Casualty
AZ Principal Mutual Life Ins. GC500(D) WITH GC 241,560 134,783 55.8
Co.
CA Principal Mutual Life Ins. GC500(D) WITH GC 243,781 126,361 51.8
Co.
CO Life Investors Ins. Co. of GMS 1,2,3 \a 218,558 102,049 46.7
America
Principal Mutual Life Ins. GC500(D) WITH GC 331,665 212,413 64.0
Co.
DC North American Life & GSC-1012 246,543 128,165 52.0
Casualty
GSC-1090 150,342 79,182 52.7
GSC-1310 2,671,438 1,656,045 62.0
GSC-1385 7,246,522 4,823,240 66.6
GSC-1395 414,519 280,887 67.8
GSC-1544 586,112 346,662 59.1
Preferred Life Ins. Co. of GSC-1310-PL 315,590 184,135 58.3
NY
DE Provident Life & Accident F-63150 326,812 203,801 62.4
Ins. Co.
GA Provident Life & Accident F-65872 278,031 179,095 64.4
Ins. Co.
HI Prudential Ins. Co. of 01 985,962 682,673 69.2
America
IA Life Investors Ins. Co. of GMS 1,2,3 \a 336,538 121,228 36.0
America
Principal Mutual Life Ins. GC500(D) WITH GC 14,020,163 8,852,946 63.1
Co.
IL Continental Casualty Co 44017 1,043,320 652,958 62.6
Life Investors Ins. Co. of GMS 1,2,3 \a 218,768 77,455 35.4
America
Principal Mutual Life Ins. GC500(D) WITH GC 1,028,204 756,447 73.6
Co.
IN Life Investors Ins. Co. of GMS 1,2,3 \a 244,275 108,787 44.5
America
Principal Mutual Life Ins. GC500(D) WITH GC 605,504 404,019 66.7
Co.
MA Blue Cross & Blue Shield of ME 2 50,933,901 29,022,187 57.0
MA
ME 4 2,438,483 1,103,984 45.3
Provident Life & Accident F-65872 167,543 79,552 47.5
Ins. Co.
Toyota Motor Life Ins. Co. MSP2000 310,311 231,725 74.7
MD Toyota Motor Life Ins. Co. MSP2000 281,468 187,160 66.5
MN Life Investors Ins. Co. of GMS 1,2,3 \a 377,045 192,892 51.2
America
MO Blue Cross & Blue Shield of LMC-1 522,926 347,304 66.4
MO
UC-24 3,335,484 2,243,323 67.3
Principal Mutual Life Ins. GC500(D) WITH GC 757,668 515,643 68.1
Co.
NC Provident Life & Accident F-63150 572,311 316,990 55.4
Ins. Co.
F-65872 230,249 160,200 69.6
ND Blue Cross & Blue Shield of MEDICARE 2,556,918 1,871,787 73.2
ND EXTENDED
Principal Mutual Life Ins. GC500(D) WITH GC 253,532 168,196 66.3
Co.
Prudential Ins. Co. of 01 1,535,480 963,734 62.8
America
NE Blue Cross & Blue Shield of 9704(I), 193,555 94,588 48.9
NE 9710(G)\a
Life Investors Ins. Co. of GMS 1,2,3 \a 229,771 104,552 45.5
America
Principal Mutual Life Ins. GC500(D) WITH GC 6,873,824 4,911,736 71.5
Co.
NJ Provident Life & Accident F-65872 450,283 305,559 67.9
Ins. Co.
NM New Mexico Blue Cross & Blue M296 502,168 169,290 33.7
Shield
NV Blue Cross & Blue Shield 82171 525,444 320,596 61.0
Plan of NV
82172 301,027 183,670 61.0
OH Principal Mutual Life Ins. GC500(D) WITH GC 583,313 328,192 56.3
Co.
Provident Life & Accident F-63150 343,197 255,296 74.4
Ins. Co.
OK Principal Mutual Life Ins. GC500(D) WITH GC 156,354 116,823 74.7
Co.
OR Blue Cross & Blue Shield of 88-MEDSTD-20 1,082,485 706,358 65.3
OR
Klamath Medical Service MS 65 208,230 141,900 68.1
Bureau
PA Provident Life & Accident F-65872 319,329 203,469 63.7
Ins. Co.
PR Prudential Ins. Co. of 01 1,063,607 672,569 63.2
America
SC Provident Life & Accident F-63150 294,975 187,249 63.5
Ins. Co.
SD Life Investors Ins. Co. of GMS 1,2,3 \a 155,553 57,593 37.0
America
TN Memphis Hospital Service & BCBS-65 CO-051 307,401 159,891 52.0
Surgical Assn.
Provident Life & Accident F-63150 266,513 183,625 68.9
Ins. Co.
TX Principal Mutual Life Ins. GC500(D)TX GC 2,893,543 1,836,155 63.5
Co.
UT Blue Cross & Blue Shield of B883650013007 186,752 115,687 61.9
UT
Hartford Life Ins. Co. SPR-7318 154,420 108,614 70.3
VA Provident Life & Accident F-65872 171,487 103,287 60.2
Ins. Co.
Toyota Motor Life Ins. Co. MSP2000 353,893 231,029 65.3
USAA Life Ins. Co. AG4001 616,221 430,468 69.9
VI Prudential Ins. Co. of 01 175,394 104,459 59.6
America
WA King County Medical Blue 33800 253,384 188,444 74.4
Shield
33900 176,657 131,382 74.4
34000 403,586 300,151 74.4
34200 163,003 121,226 74.4
Principal Mutual Life Ins. GC500(D) WITH GC 165,908 95,308 57.4
Co.
Toyota Motor Life Ins. Co. MSP2000 208,423 145,837 70.0
WI Life Investors Ins. Co. of GMS 1,2,3 \a 202,748 100,727 49.7
America
Principal Mutual Life Ins. GC500(D) WITH GC 5,867,409 4,148,788 70.7
Co.
WV Mountain State Blue Cross & ED214 1,917,393 1,391,861 72.6
Blue Shield
==================================================================================
To $124,003,963 $76,285,31
ta 1
ls
----------------------------------------------------------------------------------
\a Companies included data for similar policies on a single
experience exhibit.
MAJOR CONTRIBUTORS TO THIS REPORT
========================================================== Appendix VI
HEALTH, EDUCATION, AND HUMAN
SERVICES DIVISION,
WASHINGTON, D.C.
Thomas G. Dowdal, Assistant Director, (410) 965-8021
Roger T. Hultgren, Assignment Manager
Jerry G. Baugher, Evaluator
PHILADELPHIA REGIONAL OFFICE
Michael J. Stepek, Regional Management Representative
Michael R. Piskai, Evaluator-in-Charge
Frank J. Foley, Computer Specialist