Methods and Systems for Providing An Insurance Policy With An Inflation Protection Option
Inactive Publication Date: 2008-05-01
OBRIEN DENNIS
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Benefits of technology
[0013] This may be achieved by offering an insurance policy, such as an LTC policy, with an inflation protection option at a first or original insurance premium computed at least partially based on information useful in assessing a risk to insure the individual and at least partially based on an option that allows the individual to purchase additional coverage at a subsequent or additional premium, the subsequent premium is computed based at least partially on the individual's age at a predetermined date, which age is other than the individual's age at a date the option to purchase the additional coverage is offered, such as the insured's age at the date the policy issued. The information may be obtained by a variety of
Problems solved by technology
Insurance policies typically include coverage limitations such as maximum coverage for a given period of time or for a given event.
A problem associated with policies such as LTC policies that include maximum coverage limitations is that maximum coverage limitations are determined or specified at the time the policy is purchased.
However, inflation may out-pace the maximum coverage limitations thereby leaving the insured in an increasingly underinsured position over time.
In periods of high inflation, for instance, the specified rate of increase may be outpaced by inflation thereby leaving the insured in an underinsured position.
Additionally, Level Premium policies lock an insured into paying the fixed additional premium for the duration of the policy without the flexibility of being able to opt out from an increase and thereby out from the additional premium for any year.
This is disadvantageous to an insured that, for example, terminates coverage prior to the completion of the term of the policy.
Inflation protection under the Guaranteed Additional Amounts approach, however, normally includes several limitations on the continued right to purchase additional maximum coverage.
An insured, for instance, may lose the right to receive the option to purchase increases in the coverage limitations after declining a certain number of offers.
Since the additional premium is computed based on the insured's attained age and since the risk associated with long term care increases as the insured ages, the additional premium for the additional coverage becomes increasingly more expensive for each successive offer.
This drawback is especially unfavorable to an insured that may be on a fixed income or otherwise cannot afford higher premiums beyond a certain monetary limit.
Such an insured, therefore, may lose inflation protection altogether because he is not able to pay for additional coverage and may decline a certain number of offers.
This need is also not addressed by existing tools for analyzing and administering LTC policies.
The systems and methods discussed in these documents, however, do not address inflation protection and the problems associated therewith.
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[0020] Referring to FIG. 1, a method of providing an insurance policy, such as a long term care (LTC) insurance policy, with inflation protection, according to a preferred embodiment, begins with obtaining information useful in providing LTC insurance to an individual, step #102. This includes obtaining at least one attribute personal to the individual, step #104, which includes characteristics that distinguish or otherwise describe the individual, such as the individual's name, age, gender, a risk-based classification or classifications, etc. Some personal information such as age and gender are used in computing LTC premiums and are usually required. A risk-based classification may include, for example, whether or not the individual is overweight, has a chronic health condition such as high blood pressure, or has a history of adverse medical events such as a stroke.
[0021] Obtaining information useful in providing LTC insurance to an individual, step #102, in one embodiment, includ...
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This invention provides methods and systems for providing an insurance policy having an inflation protection option that is computed at least partially based on information useful in offering a long term care insurance policy to an individual and at least partially based on the option for the individual to purchase additional coverage at a subsequent premium that is computed based at least partially on the individual's age at a date, which date is other than the date the option to purchase the additional coverage is offered, such as the date the policy issued.
Description
CLAIM OF PRIORITY [0001] The present application is a Continuation application, relating to and claiming priority to U.S. patent application Ser. No. 10 / 191,737 entitled “METHODS AND SYSTEMS FOR PROVIDING AN INSURANCE POLICY WITH AN INFLATION PROTECTION OPTION” having a filing date of Jul. 8, 2002.COPYRIGHT NOTICE [0002] A portion of the disclosure of this patent document contains material, which is subject to copyright protection. The copyright owner has no objection to the facsimile reproduction by anyone of the patent document or the patent disclosure, as it appears in the Patent and Trademark Office patent files or records, but otherwise reserves all copyright rights whatsoever. BACKGROUND OF THE INVENTION [0003] This invention relates generally to methods and systems for providing an insurance policy with inflation protection. More particularly, the methods and systems of the present invention provide an insurance policy such as for long term care (LTC) with an inflation protec...
Claims
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Login to View More IPC IPC(8): G06Q40/00G06Q40/08
CPCG06Q40/08G06Q50/24G06Q50/22
InventorO'BRIEN, DENNIS
OwnerOBRIEN DENNIS