Moody’s evaluated a number of changes before granting the improved rating. The nationwide shift towards overall economic stability has encouraged U.S, citizens to buy more insurance in recent months.

Households are regaining discretionary funds, which are frequently used to contribute to long-neglected-but-long intended investments like life insurance. Now that the economy has started to show signs of revival, higher life and annuity premiums, along with increased deposits into pension plans, are again possible. In turn, these contributions ease pressure on insurance company revenues and earnings. Rising interest rates are also alleviating pressure on life insurers’ profit margins. With higher rates, fixed annuities and universal life insurance face less compression. Long-term investments inch closer to reserve.

Equity markets also appear to be following an upward trend, which improves the performance of variable annuities and other assets under management-fee-driven businesses. These improvements spread to improve the chances that variable annuity portfolios are likely to increase in profitability. As pension plan fees rise in response to the stimulated market, mutual funds should also increase. However, some volatility should still be expected, as those insured will always cease payment of premiums and take advantage of any guaranteed benefits.

Moody’s forecasts that the U.S. economy will continue to improve in 2014 and 2015; in current figures, the company expects an uptick of 2 to 3 percent in 2014 and of 2.5 to 3.5 percent in 2015. These increases are the result of a perceived improvement in the unemployment rate and the housing markets. In partnership with the comebacks in these two sectors, Moody’s foresees an increased demand for annuity and life insurance products. Fixed annuity rates are already slowly beginning to improve their poor performance of the past few years.

While the promise of a brighter market is cheering, approach this (and any) good news with due caution. Not all insurance products will improve. For example, sales of health-related products are predicted to remain depressed, as they are also tied to the volatile recent developments in healthcare reform. Similarly, some types of coverage, including disability, are likely to take a longer time to show any improvement.

Compare life insurance quotes from top providers and get local expert advice from Benepath.com.

The Elder Care Firm can help you manage the cost of long-term-care.

Long-term-care rates continue to increase, leaving many policyholders at a loss.

There is a growing gap in health-care coverage that is putting a number of Michiganders at a loss. Rob and Katherine Deane believed they were doing the responsible thing when they purchased insurance policies to provide care in their later years. But last year the experienced rate increases on both of their long-term-care policies, insurance plans that pay for nursing homes or in-home care.

Manulife Financial Corp.’s John Hancock unit informed Mrs. Deane that the premium on her 10-year-old policy would increase 77% to $6,406 a year. Mr. Deane’s insurer, Unum Group, raised his premium by 25%.

(Related: Health Insurance Scams On The Rise)

After making a fuss, Hancock reduce Mrs. Deane’s rate to 46%. In trade, she agreed to shrink the policy’s benefit period to six years from 10.

The long-term insurance industry is shrinking, premiums are soaring and there is no relief on the horizon. Meanwhile, government safety-net programs, pressured by cost cuts, are preparing for the demand from more of the 77 million aging baby boomers.

Granted, Obamacare is intended to provide insurance for millions of Americans, but his administration abandoned its effort to provide affordable long-term care, ruling it was too expensive.

(Related: Medicaid expansion bill will benefit all in state, Snyder says)

As is, Medicare only pays for short stays in nursing home or in-home care under limited conditions. Generally, seniors who need care have to burn through their savings to cover the cost. It takes being impoverished for Medicaid to pay for a basic level of care.

For decades insurers have sold long-term-care policies, but they vastly underestimated how quickly medical costs would rise, and the number of seniors who would use the benefits. As a result, insurance premiums were underpriced. And worse, some insurers knowingly charged too little at first with the plan to increase premiums later, says Joseph M. Belth, editor of the Insurance Forum newsletter and professor emeritus of insurance at Indiana University.

Five of the 10 largest insurance providers, including MetLife Inc., Prudential Financial Inc. and Unum have curtly reduced or discontinued sales since 2010, according to Moody’s Investors Service. Only a dozen or so companies still sell a significant number of policies, down from close to 100 a decade ago.

(Related: Caregiver Burnout)

Michigan is one of the many states that has adopted “rate stabilization” laws to tighten oversight to reduce the potential of future rate increases by requiring a more accurate initial pricing of policies.

Rate increases are forcing policyholders to dig into their savings, allocate from elsewhere, or drop their coverage. As a result, healthier policyholders may get off the train while sicker, more expensive customers stay aboard.

A number of insurance agents and financial planners are encouraging clients to employ a new “hybrid” coverage: life insurance with a rider providing long-term-care benefits. This allows the policyholder to leave something to heirs even if the long-term-care benefits don’t get tapped.

The downside is that the long-term-care benefits are often less generous than those in conventional policies, and policyholders have to write one large check upfront to get the coverage, versus paying premiums each year.

Read more: http://finance.yahoo.com/news/long-term-care-insurance-leaves-030300000.html

Christopher J. Berry is a Michigan elder law attorney Dedicated to helping seniors, veterans and their families navigate the long-term care maze. To learn more visit http://www.michiganelderlawattorney.com/ or call 248.481.4000