You asked whether a Medicare supplement insurer might set different rating rules that are based on a sign-up date rather than the policy's effective date. You indicate that an insurer offers a one-year rate guarantee to individuals that sign-up for coverage before a certain date but does not offer the guarantee to individuals who sign-up after that date.

No, Medicare supplement insurers may not offer some individuals and not others a rate guarantee based on a sign-up date when the premium increase under both policies have the same effective date.

According to the Insurance Department, the marketing practice by some insurers offering rate guarantees to individuals who sign-up for coverage by a certain date violates the community rating law required for most Medicare supplement policies (CGS § 38a-495c(a)). Under this law, most Medicare supplement policies must base their premiums on a community rate that excludes consideration of age, gender, previous claims history or medical condition as rating factors. Medicare supplement policies "H," "I," and "J" may be medically underwritten (CGS § 38a-495c(b)).

The Insurance Department has had discussions with American Progressive Insurance Co. about this marketing practice and has advised them to stop.

Mary Ellen Breault, Life and Health Division director, is familiar with the problem and may be contacted at 860-297-3857.

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