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DFR Orders Pennsylvania Long-Term Care Insurer to Cease and Desist Unauthorized Rate Actions

March 7, 2022

Montpelier, VT (March 7, 2022) – Commissioner of Financial Regulation Michael S. Pieciak today ordered insolvent long-term care insurer Senior Health Insurance Company of Pennsylvania (SHIP) to immediately stop soliciting Vermont consumers to choose between unapproved benefit and rate changes. The Department is aware of more than twenty Vermont consumers with SHIP policies – some of whom may have purchased the policies from entities called Transport Life Insurance Company or American Travelers Life Insurance Company.

SHIP’s appointed rehabilitator earlier this winter sent letters to policyholders in Vermont and other states that purported to force policyholders to choose between various options for their long-term care policies. This “Coverage Election Package” was never approved in Vermont, as required by state law.

“My order today makes clear that no out-of-state insurance company can impose rate increases or benefit cuts on Vermonters without this Department’s review and approval,” said Commissioner Pieciak. “The average Vermont SHIP policyholder is nearly 90 years old. I hope that any policyholder – or their caregiver – will not hesitate to reach out to our team at DFR for assistance.”

The coverage election package sent to Vermont policyholders is the result of a “Rehabilitation Plan” approved by a Pennsylvania Court. Vermont, along with roughly thirty other states, has joined in litigation in Pennsylvania asking the Pennsylvania Supreme Court to strike down SHIP’s current Rehabilitation Plan, which is fundamentally unfair to policyholders and is being implemented nationwide in a manner contrary to the laws of every other state, including Vermont. The plan is worse for consumers than placing the company into liquidation, which would trigger the protection of state guaranty associations, which are designed to pay claims up to $300,000 or the limit on the policyholder’s existing policy in that circumstance. The Rehabilitation Plan, instead of properly spreading the risk of insolvency and offsetting the impact on policyholders, places the entire burden of the insolvency on SHIP policyholders alone.

The rehabilitation plan and coverage election package offer “choices” but also state that SHIP will impose a “choice” on any policyholder who does not make an election.

“Unfortunately, because the coverage election package imposes a March 15 deadline and the Pennsylvania Court will not make a decision by then, I must encourage all Vermont policyholders who have received the coverage election package to make the best selection they can based on their circumstances,” the Commissioner cautioned. “My Order today is the first step in blocking SHIP from collecting increased premiums or implementing any policy changes without prior approval from this Department.”

SHIP policyholders (or their caregivers on their behalf) are encouraged to file a complaint with DFR or contact DFR’s Insurance Division if they are confused by the notice. Please connect with us at 833-DFR-HOTLINE (toll free) or 802-828-3302 or

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