Flexible Varying Premium Option for Long Term Care Insurance and Critical Illness Insurance

Abstract

Flexible, varying long term care insurance programs are determined. Input variables such as issue age, targeted present value and year-to-year premium relationship are supplied, as are some members of a set of process variables. A non-supplied process variable is calculated based on the input variables and the supplied process variables. An insurance program based on the supplied variables and the calculated process variable is then determined, such that the premium schedule increases (or alternatively, decreases) over time to at least one leveling point, at which premiums become level.

Description

PRIORITY CLAIM

This application is a continuation of commonly assigned, co-pending U.S. patent application Ser. No. 12/346,602, filed Dec. 30, 2008, entitled “Flexible Varying Premium Option for Combination Products Including Long Term Care Insurance,” the entirety of which is hereby incorporated by reference (the “FIPO for Combination Products Application”). The FIPO for Combination Products application is a continuation in part of commonly assigned, co-pending U.S. patent application Ser. No. 11/291,554, filed Nov. 30, 2005, entitled “Flexible Varying Premium Option for Long Term Care Insurance,” the entirety of which is hereby incorporated by reference (the “FIPO for LTCI Application”). The FIPO for LTCI Application claims the benefit under 35 U.S.C. §119(e) of U.S. Provisional Patent Application Ser. No. 60/665,211, filed Mar. 24, 2005, entitled “Long Term Care Insurance, A New Premium Paradigm: Increasing Premiums with Cap at Later Ages,” the entirety of which is incorporated herein by reference.

TECHNICAL FIELD

This invention pertains generally to calculating insurance programs, and more specifically to methodology for providing flexible increasing premium options for long term care insurance policies.

BACKGROUND

Long-Term Care Insurance (LTCI) policies cover services including nursing home stays, assisted living facility stays, home health care, adult day care and personal care services. Subject to benefit eligibility requirements, policies typically reimburse actual long-term care expenses up to a specified daily maximum for a total amount up to a specified lifetime maximum, with indemnity and disability benefit payment plans also available.

LTCI policies typically have premiums payable for life and cover the risk and cost of long-term care services. While there are policies that have a limited premium-paying period, such as ten years or to age sixty-five, the vast majority of policies (more than 98%) are payable for life based on the issue age of the insured person. Since the likelihood of using long-term care services increases with advancing age, it would require ever-increasing premiums if paid based on attained age. The reality is that most insureds would be unable to afford this increasing cost. Consequently, a level premium structure that is higher for each older issue age of the insured is typically utilized to address this cost problem. This level premium structure provides for significant prefunding of the greater cost of claims as people age.

In recent years, the average issue age in the individual LTCI market has dropped from over age sixty-five to under age sixty. The average time from issue to claim is over ten years. LTCI has evolved from a means to protect assets of the elderly to a retirement planning consideration for pre-retirees. Since costs of long-term care services rise over time due to inflation, it is common and advisable for pre-retirees to purchase policies that allow the benefits to keep pace with this inflation. Otherwise, the policies would reimburse a progressively smaller portion of long-term care expenses.

Medicare provides limited coverage for long-term care expenses for people over age sixty-five. It generally pays for rehabilitative home health care and a limited portion of costs during the first 100 days in a nursing home. Medicaid provides broader coverage but only for the indigent. Private LTCI can potentially serve as a long-term care financing source for a significant proportion of the population. However, a policy with adequate coverage is fairly expensive. For example, the typical annual premium for an insured at issue age 50 is over $1,200.

A delay in purchase will result in even higher premiums later. This is due to the increase in premiums by issue age and the rising cost of care due to inflation. As well, the health status of the purchaser might have worsened, resulting in a rejection of coverage by the insurer.

Attempts to reduce the otherwise high premium costs are available in the form of a number of policy options. A policy without a provision for annual inflation increases may contain an option that permits periodic future purchases of additional coverage without evidence of insurability. The amounts of additional coverage are usually tied to the Consumer Price Index or set at a flat percentage, such as 5%. The level premiums at the attained ages of the purchases will apply to the additional coverage. An inflation variation would allow the premiums for the subsequent inflation increases to be based on the original issue age, but at a higher initial level than the corresponding issue age level premium without this option. Another option provides 5% annual increases in both the premiums and the benefits. All these options have no limitation on future premium increases. In later years when adequate coverage becomes critical, the premiums required can be prohibitively expensive.

The expected claims in the early policy years for a particular policy are substantially less than the level premium and the reverse is true in later years. This accounts for the pre-funding aspect in LTCI policies. However, the policy has no cash value. The insured would have paid premiums significantly in excess of the costs of coverage if the policy were lapsed during the early years.

Due to the low frequency of claims, few insurers have credible insured experience to determine the premiums accurately. Insurers are subject to long-tailed risks in claim, mortality, policy lapse, investment and expense experience. In general, insurers' experience has been unfavorable as evidenced by rate increases by a number of insurers on in-force policies as well as new business. For these reasons, product innovation has been progressing cautiously.

What is needed are methods for calculating LTCI insurance programs that are both profitable to insurers and affordable to insured parties. Also, the insurance programs should be flexible in meeting consumer's financial requirements at various stages of life.

SUMMARY OF INVENTION

Methods, computer program products and computer systems calculate flexible, varying long term care insurance programs. Input variables such as issue age, targeted present value and year-to-year premium relationship are supplied, as are some members of a set of process variables. A non-supplied process variable is calculated based on the input variables and the supplied process variables. In one embodiment, three of the following four process variables are supplied: a set of policy features, an initial premium amount, a leveling point and an ultimate level premium. In that embodiment, the fourth process variable is then calculated based upon the other three and the input variables. An insurance program based on the supplied variables and the calculated process variable is then determined, such that the corresponding premium schedule increases (or alternatively, decreases) over time to at least one leveling point, at which premiums become level. The calculated program is intended to meet the present and future needs of the buyer, and yet still hit the target present value so that it is profitable to the seller. Leveling points can be dates at which the buyer expects a decrease (or increase) in disposable income, such as retirement, payoff of loans, children entering or graduating from college, etc.

The features and advantages described in this summary and in the following detailed description are not all-inclusive, and particularly, many additional features and advantages will be apparent to one of ordinary skill in the relevant art in view of the drawing, specification, and claims hereof. Moreover, it should be noted that the language used in the specification has been principally selected for readability and instructional purposes, and may not have been selected to delineate or circumscribe the inventive subject matter, resort to the claims being necessary to determine such inventive subject matter.

BRIEF DESCRIPTION OF THE DRAWINGS

FIG. 1 is a block diagram illustrating determining an LTCI premium schedule with an increasing pattern, according to some embodiments of the present invention.

FIG. 2 is block diagram illustrating a process using a plurality of variables to calculate an LTCI insurance program, according to some embodiments of the present invention.

FIG. 3 is a diagram illustrating the relative degree of pre-funding for a schedule calculated according to an embodiment of the present invention and a level premium schedule.

FIG. 4A is a graph illustrating two level premium policies, with and without inflation protection, assuming a 5% annual inflation rate.

FIG. 4B is a graph illustrating how both premiums and benefits can be effectively aligned in terms of real dollars, according to an embodiment of the present invention.

The Figures depict embodiments of the present invention for purposes of illustration only. One skilled in the art will readily recognize from the following discussion that alternative embodiments of the structures and methods illustrated herein may be employed without departing from the principles of the invention described herein.

DETAILED DESCRIPTION

FIG. 1 illustrates a high level overview of determining an LTCI premium schedule 100 with an increasing pattern according to one embodiment of the present invention. In the embodiment illustrated in FIG. 1, the schedule begins with an initial premium 101 at the first policy year and uses calculated, incremental pre-funding to increase to a policy anniversary 103 (or other point) at, for example, a pre-determined attained age or policy duration, at which point the premium becomes level 105. The level premium 105 remains in effect from that policy anniversary 103 and thereafter. Through the use of incremental pre-funding early on, the schedule can be leveled at the desired 103 point even though the real cost of the policy benefits increase as the insured party ages.

Premiums will generally become level 105 when the insured party attains an age near normal retirement, after which the insured will be on a relatively fixed income. However, in other embodiments of the present invention, other ages as well as non-age based events can be used to reform the schedule 100 based on the needs of the insured or group. Any anticipated future event of the buyer can be met through the use of different premium schedules 100, impacting the timing and amount of pre-funding. For example, the rate of increase can be set to incrementally raise at the time of anticipated events which will raise the buyers level of disposable income (e.g., children graduate from college, home mortgage is paid off), or level off (or, alternatively, decrease) in accordance with income lowering events, such as retirement, children entering college, etc. Specific premium schedules 100 can be set by the insurers according to various embodiments of the present invention in order to address the needs of various segment of the market. The schedule 100 can range from a simple schedule 100 for the group market that, for example, increases every three years by attained age until age 65 to a more complicated schedule 100 that is customized to an individual applicant in the individual market.

Schedules 100 calculated according to the present invention comprise an alternative to the current issue age level premium pattern. Such schedules 100 do not affect the underlying policy benefits. Schedules calculated according to the present invention lower the premiums for the initial policy years below the corresponding level premium of a policy with identical benefits. The ultimate premium will thus be higher than the corresponding level premium.

In many but not all embodiments of the present invention, schedules 100 are calculated for policies with a provision for inflation protection. Such policies are more expensive than policies without the inflation protection. For younger issue ages below fifty, they are more than twice as expensive. Note also that in some embodiments, under a policy generated by the present invention, an insured with an inflation protection provision can choose to freeze premiums at the current level and benefits at a corresponding level should an unforeseen event occur causing future premiums increases to be unaffordable.

FIG. 2 illustrates the use of a plurality of variables to calculate an insurance program 200 (i.e., a set of benefits and a corresponding premium schedule 100) according to some embodiments of the present invention. Note that the example of FIG. 2 illustrates variables used for calculating a schedule 100 with premiums that are raised until a single leveling point 103, as illustrated in FIG. 1. However, the variables can be adjusted to calculate schedules 100 with multiple leveling points 103 and/or one or more increase or decrease points as desired.

The process of calculating an insurance program 100 according to the present invention can utilize the following variables:

• • 1. a set of policy features 201;
  • 2. the initial annual premium 101, e.g., payable during the first policy year;
  • 3. the point 103 at which premiums become level (e.g., the policy anniversary at which time premiums become level);
  • 4. the amount of the ultimate level annual premium 105;
  • 5. the issue age 203;
  • 6. the year-to-year premium relationship 205 during the period when premiums are increasing; and
  • 7. a targeted present value 207 of future premiums.

The last three variables 203, 205 and 207 are inputs to an insurance program determination process 208 that are specified prior to the program 200 calculation. With any three of the first four variables 201, 101, 103, 105 selected, a value 209 for the remaining variable of the first four can be calculated. This output value 209 and the three selected variables define the insurance program 200 (e.g., in the illustrated example a program 200 with a schedule 100 that increases during a prescribed period and then becomes level). Where more complicated programs 200 and/or schedules 100 are desired, the variables are adjusted accordingly (e.g., multiple leveling dates, other types of adjustment dates, etc.).

Given the supplied inputs, the first four variables, namely, the policy features 201, the initial premium 101, the leveling point 103 and the ultimate level premium 105, determine an insurance program 200. By varying these four factors, an insurance program 200 can be developed that meets the budgetary requirement of a potential purchaser. For example, suppose that an initial premium 101 is desired for a specific plan 201, and a specific leveling age 103 is selected. The ultimate level premium 105 is then calculated based on the supplied variables. Alternatively, given an attained age 103 when premiums will become level, an ultimate level premium 105 and a specific plan 201, the initial premium 101 can be solved.

Each of the variables is now described in greater detail. An LTCI policy is typically defined by the following features 201: daily benefit maximum, lifetime benefit maximum, elimination period, inflation protection option, underwriting risk class, and other optional benefits. These features can either be inputs to the calculation process 208 or the output 209. While the invention can solve for any one or a combination of the features, it is most convenient to solve for the daily benefit maximum, with other features specified beforehand. For cost and risk reasons, the insurer may impose upper and lower limits on the daily benefit maximum.

The initial premium 101 can either be an input to the process 208 or the output 209. As an input, the initial premium 101 is typically expressed as a percentage of the corresponding level premium for a plan with the identical issue age and policy features. Insurers incur considerable costs to acquire a policy. These costs include marketing expenses, underwriting and issue expenses, commissions, risk-based capital, etc. Accordingly, insurers may want to set a minimum on the initial premium 101 in order to recoup the acquisition costs within a reasonable period.

The leveling point 103 (e.g., the policy anniversary when the premium becomes level) can either be an input to the process 208 or the output 209. It can be, for example, any anniversary after issue. In order to make the initial premium 101 relatively low and therefore affordable, insurers may require a minimum number of increasing premium years before premiums become level in the future.

The ultimate level annual premium 105 can either be an input to the process 208 or the output 209.

Issue age 203 affects the amount of premiums since the likelihood of claiming for LTC services increases with age. Due to regulatory constraints, insurers may establish issue age limits that are different from those for level premium policies.

The premium relationship 205 describes how the premium of one year is related to that of the prior year. Basic patterns are: a constant percentage increase over the premium for the prior policy year, a constant dollar increase over the premium for the prior policy year, and increases at the beginning of regular or irregular intervals but level during the intervals. Any combination of the basic pattern or other increasing patterns is possible. Combinations with today's existing premium patterns, such as future premium decreases or limited premium paying periods, are also possible. In order to minimize the potential hardship of paying higher premiums, an insurer may restrict the amount of the annual increases.

According to its profit goals, the insurer sets the targeted present value 207 of premiums. The present value 207 of any increasing premium schedule 100 is then calibrated to meet this target 207. The target present value 207 varies by issue age and policy features as described under the first variable.

The targeted present value 207 takes into account the expected time value of money and the expected persistency of policies. A discount rate determines the expected time value of money. The discount rate does not necessarily tie to the expected investment return of the assets in the insurer's investment portfolio allocated to its LTCI business. A table of expected mortality rates that vary by attained age and a set of expected policy lapse rates typically form the basis for the persistency assumption.

To determine the targeted present value 207, the insurer starts with the corresponding level premium for the specific set of policy features 201. It calculates the projected profits based on morbidity, persistency, investment return and expense assumptions. The level premium is adjusted until the desired projected profits are achieved. Then, the present value of the level premiums, calculated using the discount rate, mortality and voluntary lapse rates, is set as the target 207.

Once an insurer gains sufficient experience from sales of insurance programs 200 calculated according to the present invention, refinements can be applied to help achieve the profit objectives more precisely. For example, instead of using a level premium, the insurer may use an increasing premium schedule 100 that represents the expected average of all the schedules 100 to be generated according to the present invention for a specific issue age 201 and policy features 201.

In setting the targeted present value 207, the insurer seeks to strike a balance between desired profit goals and attractiveness of the resulting premium schedules 100 to the potential purchasers. A low target 207 will undermine the profit objectives while a high target 207 will produce an expensive premium schedule 100, which may not compare favorably with the corresponding level premium.

Due consideration is also given to the contingency that the insured can opt to request a freeze in future premiums at the current level with a corresponding freeze of the daily benefit maximum and the lifetime policy maximum. This feature is a desirable part of a LTCI policy with inflation protection provision calculated according to the present invention. The purpose of this option is to mitigate potential lapse by the insured when and if future premium increases become a financial burden.

Some embodiments of the present invention add an optional feature for those who lapse their policy, so as to give them credit based on the value of past premium payments up until the time of lapse. According to one such embodiment, lapsed policy holders can still be eligible for benefits up to a paid up amount. This benefit can be triggered when the lapse occurs because a predetermined percentage or amount of premium increase is exceeded. In other such embodiments, the party can be eligible for the benefit when the lapse occurs for other reasons (or regardless of the reason for the lapse). In one embodiment with such optional features, the policy benefits will be paid up to a maximum amount equal to the prior cumulative premiums paid into the insurance program 200. In another such embodiment, the policy benefits will be paid up to a maximum amount equal to a percentage of the prior cumulative premiums paid into the insurance program 200. In yet another such embodiment, the benefits are paid up to a maximum equal to the amount of premiums paid into the program 200 plus a percentage thereof.

The process 208 employs an iterative procedure to compare the targeted present value 207 with the present value of future premiums from the interim premium schedule 100. Once the discounted value of a schedule 100 matches the target 207, that schedule 100 becomes the solution.

It will be readily understood by one of ordinary skill in the relevant art that the steps of this process 208 can be automated (e.g., performed by a computer program) or performed manually. At least for the calculation intensive steps, automation will be far more practical, but is not required. The implementation mechanics of the execution of the steps of the process 208 will be readily apparent to those of ordinary skill in the relevant art in light of this specification.

For purposes of illustration, some examples of calculating insurance programs 200 according to various embodiments of the present invention follow.

Example 1

A worker age 50 (the issue age 203) can afford to pay a $600 initial annual premium 101 and a $2,100 ultimate level premium 105 when retired at age 65 (the leveling point 103). A schedule 100 of a $600 initial premium 101, increasing 8.1% per year (the premium relationship 205) and reaching a cap premium 105 of $2,100 at attained age 65 (leveling point 103) can fund coverage with the following policy features 201: $123 daily maximum, $224,475 lifetime maximum (5 year benefit period), 90 day elimination period and 5% compounded inflation protection.

Example 2

A worker age 42 (the issue age 203) can afford a $1,700 annual premium 105 when retired at age 60 (leveling point 103) and chooses the following policy features 201: $110 daily benefit maximum, no lifetime maximum, 30 day elimination period and 5% simple inflation protection. A $873 initial annual premium 101 can fund that schedule 100, assuming a premium relationship 205 of a constant percentage premium increase per year.

Example 3

A worker age 45 (the issue age 203) can afford a $360 initial annual premium 101 and plans to retire at age 62 (leveling point 103). He chooses the following policy features 201: $130 daily maximum, $237,250 lifetime maximum (5 year benefit period), 90 day elimination period and 5% compound inflation protection. Assuming a premium relationship 205 of a constant percentage premium increase per year, the ultimate premium 105 in this scenario will be $2,271 per year (from age 62 on).

Example 4

Assume a firm is installing a contributory insurance program for its employees. The coverage has the following policy features 201: a $100 daily maximum benefit with a lifetime maximum of $182,500 (5 year benefit period), both amounts increasing 5% compounded each year, with a 90 day elimination period.

For issue ages 203 of 60 and under, the firm will pay half of the premiums calculated according to the present invention until retirement. The cap age 103 is 65 regardless of when the employee retires. For issue ages 203 of 61 and above, the firm will pay half of a traditional, level premium schedule 100 until retirement. Employees are responsible for premiums after retirement. The firm's contribution ceases if employment is terminated prior to retirement.

The firm sets the initial premiums 101 for the invention generated schedule 100 by issue age. Premiums increase each year and reach the ultimate levels 105 at age 65 (leveling point 103). The initial 101 and ultimate 105 premiums payable by the employees are shown below in Table 1.

TABLE 1
		Monthly
		Cap Premium	Monthly
	Monthly	Between Age 65	Cap Premium
Issue Age	Initial Premium*	And Retirement*	After Retirement**
35	$20	$73	$146
40	$22	$63	$126
45	$25	$58	$116
50	$30	$65	$130
55	$37	$72	$144
60	$45	$83	$166
*Matching employer contributions
**Employee only

The schedule 100 generated according to the present invention allows low contributions by the firm in the early years and delegates the funding to the employees after retirement.

Under the current level premium pattern, premiums in the early policy years (except for the first year) exceed the expected claims plus expenses. Portions of the excess of premiums over claims and expenses are set aside as reserves in order to pay claims in the later years when claims exceed premiums and expenses. Such pre-funding will be less for policies generated according to the present invention than corresponding level premium policies.

FIG. 3 illustrates the degree of pre-funding 301 during the first 30 years for a policyholder at issue age 50. The amount of pre-funding 301 is represented by the area between the schedule 100 calculated according to the present invention or the level premium and the claims plus expenses.

Relative to level premium policies, the lower pre-funding 301 provides lower costs of coverage for insureds who lapse or claim in the early policy years (premiums are typically waived during claim). Furthermore, lower pre-funding 301 implies lower reserves in the early policy years.

In developing a LTCI product, an insurer desires a reasonable return on its capital investments. For establishing premiums, return is measured recognizing the time value of money. Consequently, profit margins in the early policy years have a greater impact on the return than those in the later years. Thus, because of the lower premiums in the early years when compared to a level premium policy with the same benefits, the return from policies calculated according to the present invention would to be correspondingly lower, all other things being equal.

In setting the target present value 207, the insurer has two mitigating factors that help to offset the effect of lower initial premiums on margins. First, in most cases, commissions, as a percentage of premiums, are higher in the first policy year than renewal years. On a discounted basis, commissions from the increasing premium schedule 100 calculated according to the present invention will be relatively lower as a percentage of premiums than the corresponding commissions from a level premium structure. Second, the reserves will also be lower, as described above. Since reserves are part of invested assets, lower reserves will also result in lower investment returns. However, the net effect, in general, would be to provide greater margins in the early policy years for policies generated by the invention than for level premium policies.

Thus the present invention lowers the initial cost of coverage for the insured while maintaining profitability for the insurer.

The present invention makes LTCI policy premiums more affordable now and later. Individuals who cannot afford the level premiums of current policies with appropriate coverage can purchase the policies generated according to the present invention. For those who can afford the level premiums but may have to select inadequate coverage, the invention enables them to purchase adequate coverage from the start. The expected increases in future earning power can offset the increases in future premiums.

Today's LTCI premium schedules 100 are very rigid (level), or relatively unknown (additional periodic future purchase options). An insurance program 200 generated by the invention can be customized to the purchaser's needs. Moreover, the corresponding schedule 100 is known at time of issue so that the purchaser can budget for the future premiums.

The invention can produce a premium schedule 100 that will require fewer premium dollars in the early years than a policy with level premiums. Should the policy lapse in the early years, the policyholder would have paid less in premiums than with a level premium policy for the same coverage.

LTCI is generally characterized by a relatively long period before claims will be paid. Over time, the effect of increases in the costs of LTC services due to inflation can be significant. This effect can be expressed in terms of “real” dollars. That is, what is a dollar in the future worth in terms of today's dollar? ? FIG. 4A illustrates two level premium policies, with and without inflation protection, assuming a 5% annual inflation rate.

Without inflation protection, benefit amounts will erode in the future. While the benefits will keep pace with inflation under a policy with inflation protection feature, the insured is over-paying in real premium dollars in the early policy years, relative to later policy years.

By using the present invention, both the premiums and benefits can be effectively aligned in terms of real dollars, as illustrated in FIG. 4B.

In addition, the eventual level premium structure that the present invention can provide is appropriate for most retirees who are living within fixed incomes.

It is to be understood that a general purpose computer can be programmed to perform the inventive methodology described herein, and the invention can but need not be instantiated in that form. Although performing the underlying calculations manually is possible and is within the scope of the present invention, it is certainly more convenient and practical to program a computer to perform at least the calculation intensive steps of the method. Where this is the case, the inventive methodology can be instantiated as software, hardware, firmware or any combination of these. Where the invention or components thereof are instantiated as software, the software can be in the form of portions in computer memory (e.g., random access memory of a computer executing the software) and/or stored on computer readable media such as magnetic or optical media. Of course, selling or otherwise commercializing insurance policies calculated according to the present invention is within the scope thereof.

Critical illness insurance is a form of insurance that covers the risk of dreaded ailments such as heart attack, stroke, cancer, renal failure and major organ transplant. While its insurance risk coverage is different from LTCI, the premium funding issues are identical. The invention applies equally well for critical illness insurance policies as for LTCI policies.

As will be understood by those familiar with the art, the invention may be embodied in other specific forms without departing from the spirit or essential characteristics thereof. Likewise, the particular naming and division of the processes, variables, modules, agents, managers, functions, layers, features, attributes, methodologies and other aspects are not mandatory or significant, and the mechanisms that implement the invention or its features may have different names, divisions and/or formats. Accordingly, the disclosure of the present invention is intended to be illustrative, but not limiting, of the scope of the invention, which is set forth in the following claims.

Claims

1. A computer implemented method for calculating a flexible, varying insurance program, the method comprising the steps of:

receiving, by a computer, a plurality of input variables, comprising at least an issue age, a targeted present value and a year-to-year premium relationship;

receiving, by a computer, a plurality of process variables;

calculating, by a computer, a non-received process variable, based on received variables; and

calculating, by a computer, a set of benefits and a corresponding charge schedule based on the received variables and the calculated process variable, such that the calculated charge schedule varies over time but becomes level at at least one specific point, according to the year-to-year premium relationship.

2. The method of claim 1 further comprising:

calculating, by a computer, a charge schedule comprising at least one period during which premiums incrementally raise to a leveling point, the calculated set of benefits and the calculated charge schedule being informed by prefunding during the at least one period during which premiums incrementally raise to the leveling point.

3. The method of claim 1 further comprising:

calculating, by a computer, a charge schedule with comprising multiple leveling points.

4. The method of claim 1 further comprising:

calculating, by a computer, a charge schedule with at least one period during which premiums decrease to a leveling point.

5. The method of claim 1 further comprising:

calculating, by a computer, a charge schedule wherein premiums incrementally raise to a single leveling point, at which the premiums become level for the remainder of the calculated charge schedule, the calculated set of benefits and the calculated charge schedule being informed by prefunding during the period during which premiums incrementally raise to the leveling point.

6. The method of claim 5 further comprising:

receiving, by a computer, three process variables from a group consisting of: a set of policy features; an initial premium amount; a leveling point; and an ultimate level premium;

and calculating, by a computer, the fourth process variable of the group based on received input variables and the three received process variables.

7. The method of claim 6 wherein:

the set of policy features specifies a provision for inflation protection.

8. The method of claim 6 further comprising:

calculating, by a computer, the set of benefits and the charge schedule such that benefits and premiums can be frozen at any point in the calculated charge schedule.

9. The method of claim 1 wherein:

the varying insurance program further comprises a varying critical illness insurance program.

10. The method of claim 1 wherein:

the varying insurance program further comprises a varying long term care insurance program.

11. At least one non-transitory computer readable storing a computer program product for calculating a flexible, varying insurance program, the computer program product comprising:

program code for receiving, by a computer, a plurality of input variables, comprising at least an issue age, a targeted present value and a year-to-year premium relationship;

program code for receiving, by a computer, a plurality of process variables;

program code for calculating, by a computer, a non-received process variable, based on received variables; and

program code for calculating, by a computer, a set of benefits and a corresponding charge schedule based on the received variables and the calculated process variable, such that the calculated charge schedule varies over time but becomes level at at least one specific point, according to the year-to-year premium relationship.

12. The computer program product of claim 11 further comprising:

program code for calculating, by a computer, a charge schedule comprising at least one period during which premiums incrementally raise to a leveling point, the calculated set of benefits and the calculated charge schedule being informed by prefunding during the at least one period during which premiums incrementally raise to the leveling point.

13. The computer program product of claim 11 further comprising:

program code for calculating, by a computer, a charge schedule with comprising multiple leveling points.

14. The computer program product of claim 11 further comprising:

program code for calculating, by a computer, a charge schedule with at least one period during which premiums decrease to a leveling point.

15. The computer program product of claim 11 further comprising:

program code for calculating, by a computer, a charge schedule wherein premiums incrementally raise to a single leveling point, at which the premiums become level for the remainder of the calculated charge schedule, the calculated set of benefits and the calculated charge schedule being informed by prefunding during the period during which premiums incrementally raise to the leveling point.

16. The computer program product of claim 15 further comprising:

program code for receiving, by a computer, three process variables from a group consisting of: a set of policy features; an initial premium amount; a leveling point; and an ultimate level premium;

and program code for calculating, by a computer, the fourth process variable of the group based on received input variables and the three received process variables.

17. The computer program product of claim 16 wherein:

the set of policy features specifies a provision for inflation protection.

18. The computer program product of claim 16 further comprising:

program code for calculating, by a computer, the set of benefits and the charge schedule such that benefits and premiums can be frozen at any point in the calculated charge schedule.

19. The computer program product of claim 11 wherein:

the varying insurance program further comprises a varying critical illness insurance program.

20. The computer program product of claim 11 wherein:

the varying insurance program further comprises a varying long term care insurance program.