Living benefit riders to life insurance policies: Pricing considerations and strategy
Adding benefit riders to policies provides meaningful coverage for those who need it, and carriers usually can do so at a relatively low cost.
This white paper explores the pending changes to the amount and structure of subsidies on the individual exchanges under the Biden administration’s American Rescue Plan (ARP). The changes can have a significant impact on enrollment, health status of the risk pool, and what members spend for coverage in premiums and out-of-pocket costs. We look at how the changes will improve the affordability of silver-level coverage for all subsidized exchange enrollees, regardless of income. Also examined is the how extension of subsidies past the current 400% federal poverty limit (FPL) will affect nearly three million Americans. The paper then discusses the potential impact of changing the benchmark subsidy plan to a gold-level coverage, which is not currently under consideration but was promoted by President Biden during his campaign. Carriers will likely have new opportunities to increase their enrollment if membership in the overall individual market swells as a result of the subsidy increases in the ARP, and even more so if a gold standard is adopted.