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The commissioner shall adopt regulations that include standards for full and fair disclosure, setting forth the manner, content and required disclosures for the sale of long-term care insurance policies, terms of renewability, initial and subsequent conditions of eligibility, nonduplication of coverage provisions, coverage of dependents, preexisting conditions, termination of insurance, continuation or conversion, probationary periods, limitations, exceptions, reductions, elimination periods, requirements for replacement, recurrent conditions and definitions of terms.
No long-term care insurance policy may:
Be cancelled, nonrenewed or otherwise terminated on the grounds of the age or the deterioration of the mental or physical health of the insured individual or certificate holder;
Contain a provision establishing a new waiting period in the event existing coverage is converted to or replaced by a new or other form within the same company, except with respect to an increase in benefits voluntarily selected by the insured individual or group policyholder;
Provide coverage for skilled nursing care only or provide significantly more coverage for skilled care in a facility than coverage for lower levels of care. This evaluation of the amount of coverage provided shall be based on aggregate days of care covered for lower levels of care when compared to days of care covered for skilled care; or
Require a policyholder to have received skilled care before coverage for intermediate care or custodial care begins.
Preexisting condition:
No long-term care insurance policy or certificate, other than a policy or certificate issued to a group as defined in § 56-42-103(4)(A), (B) or (C), shall use a definition of “preexisting condition” that is more restrictive than the following: “Preexisting condition” means a condition for which medical advice or treatment was recommended by, or received from, a provider of health care services, within six (6) months preceding the effective date coverage of an insured person;
No long-term care insurance policy or certificate other than a policy or certificate issued to a group as defined in § 56-42-103(4)(A), (B) or (C) may exclude coverage for a loss or confinement that is the result of a preexisting condition, unless the loss or confinement begins within six (6) months following the effective date of coverage of an insured person;
The commissioner may extend the limitation periods set forth in subdivisions (c)(1) and (2) as to specific age group categories in specific policy forms upon findings that the extension is in the best interest of the public; and
The definition of “preexisting condition” does not prohibit an insurer from using an application form designed to elicit the complete health history of an applicant, and, on the basis of the answers on that application, from underwriting in accordance with that insurer's established underwriting standards. Unless otherwise provided in the policy or certificate, a preexisting condition, regardless of whether it is disclosed on the application, need not be covered until the waiting period described in subdivision (c)(2) expires. No long-term care insurance policy or certificate may exclude or use waivers or riders of any kind to exclude, limit or reduce coverage or benefits for specifically named or described preexisting diseases or physical conditions beyond the waiting period described in subdivision (c)(2).
Prior hospitalization/institutionalization:
No long-term care insurance policy may be delivered or issued for delivery in this state if the policy:
Conditions eligibility for any benefits on a prior hospitalization requirement;
Conditions eligibility for benefits provided in an institutional care setting on the receipt of a higher level of institutional care; or
Conditions eligibility for any benefits other than waiver of premium, post-confinement, post-acute care or recuperative benefits on a prior institutionalization requirement.
A long-term care insurance policy containing any limitations or conditions for eligibility other than those prohibited in subdivision (d)(1) shall clearly label in a separate paragraph of the policy or certificate entitled “Limitations or Conditions on Eligibility for Benefits” the limitations or conditions, including any required number of days of confinement.
A long-term care insurance policy containing a benefit advertised, marketed or offered as a home health care or home care benefit may not condition receipt of benefits on a prior institutionalization requirement.
A long-term care insurance policy that conditions eligibility of noninstitutional benefits on the prior receipt of institutional care shall not require a prior institutional stay of more than thirty (30) days from which benefits are paid.
No long-term care insurance policy or rider that provides benefits only following institutionalization shall condition the benefits upon admission to a facility for the same or related conditions within a period of less than thirty (30) days after discharge from the institution.
The commissioner may adopt regulations establishing loss ratio standards for long-term care insurance policies; provided, that a specific reference to long-term care insurance policies is contained in the regulation.
Right to return — free look:
Individual long-term care insurance policyholders have the right to return the policy within thirty (30) days of its delivery and to have the premium refunded if, after examination of the policy, the policyholder is not satisfied for any reason. Individual long-term care insurance policies shall have a notice prominently printed on the first page of the policy, or attached to the policy, stating in substance that the policyholder shall have the right to return the policy within thirty (30) days of its delivery and to have the premium refunded if, after examination of the policy, the policyholder is not satisfied for any reason. Upon return of the policy for cancellation, the company shall mail the premiums directly to the policyholder and shall not require the policyholder to meet with the agent to receive the refund; and
A person insured under a long-term care insurance policy issued pursuant to a direct response solicitation shall have the right to return the policy within thirty (30) days of its delivery and to have the premium refunded if, after examination, the insured person is not satisfied for any reason. Long-term care insurance policies issued pursuant to a direct response solicitation shall have a notice prominently printed on the first page, or attached to the first page, stating in substance that the insured person shall have the right to return the policy within thirty (30) days of its delivery and to have the premium refunded if, after examination, the insured person is not satisfied for any reason.
Outline of coverage:
An outline of coverage shall be delivered to a prospective applicant for long-term care insurance at the time of initial solicitation through means that prominently direct the attention of the recipient to the document and its purpose.
The commissioner shall prescribe a standard format, including style, arrangement and overall appearance and the content of an outline of coverage.
In the case of agent solicitations, an agent must deliver the outline of coverage prior to the presentation of an application or enrollment form.
In the case of direct response solicitations, the outline of coverage must be presented in conjunction with the application or enrollment form.
In the case of a policy issued to a group defined in § 56-42-103(4)(A), an outline of coverage shall not be required to be delivered; provided, that the information described in subdivision (g)(4) is contained in other materials relating to enrollment. Upon request, these other materials shall be made available to the commissioner.
The outline of coverage shall include:
A description of the principal benefits and coverage provided in the policy;
A statement of the principal exclusions, reductions and limitations contained in the policy;
A statement of the terms under which the policy or certificate, or both, may be continued in force or discontinued, including any reservation in the policy of a right to change premiums. Continuation or conversion provisions of group coverage shall be specifically described;
A statement that the outline of coverage is a summary only, not a contract of insurance, and that the policy or group master policy contains governing contractual provisions;
A description of the terms under which the policy or certificate may be returned and premium refunded;
A brief description of the relationship of cost of care and benefits; and
A statement that discloses to the policyholder or certificate holder whether the policy is intended to be a federally tax-qualified long-term care insurance contract under § 7702B(b) of the Internal Revenue Code of 1986 (26 U.S.C. § 7702B(b)).
A certificate issued pursuant to a group long-term care insurance policy, which policy is delivered or issued for delivery in this state shall include:
A description of the principal benefits and coverage provided in the policy;
A statement of the principal exclusions, reductions and limitations contained in the policy; and
A statement that the group master policy determines governing contractual provisions.
If an application for a long-term care insurance contract or certificate is approved, the issuer shall deliver the contract or certificate of insurance to the applicant no later than thirty (30) days after the date of approval.
At the time of the policy delivery, a policy summary shall be delivered for an individual life insurance policy that provides long-term care benefits within the policy or by rider. In the case of direct response solicitations, the insurer shall deliver the policy summary upon the applicant's request, but regardless of request shall make delivery no later than at the time of policy delivery. In addition to complying with all applicable requirements, the summary shall also include:
An explanation of how the long-term care benefit interacts with other components of the policy, including deductions from death benefits;
An illustration of the amount of benefits, the length of benefit, and the guaranteed lifetime benefits, if any, for each covered person;
Any exclusions, reductions and limitations on benefits of long-term care;
A statement that no long-term care inflation protection option is available under the policy;
If applicable to the policy type, the summary shall also include:
A disclosure of the effects of exercising other rights under the policy;
A disclosure of guarantees related to long-term care costs of insurance charges; and
Current and projected maximum lifetime benefits; and
The provisions of the policy summary listed in subdivisions (j)(1)-(5) may be incorporated into a basic illustration, or into the life insurance policy summary, which is required to be delivered in accordance with rules promulgated by the commissioner.
Any time a long-term care benefit, funded through a life insurance vehicle by the acceleration of the death benefit, is in benefit payment status, a monthly report shall be provided to the policyholder. The report shall include:
Any long-term care benefits paid out during the month;
An explanation of any changes in the policy, e.g. death benefits or cash values, due to long-term care benefits being paid out; and
The amount of long-term care benefits existing or remaining.
If a claim under a long-term care insurance contract is denied, the issuer shall, within sixty (60) days of the date of a written request by the policyholder or certificate holder, or a representative of the policyholder or certificate holder:
Provide a written explanation of the reasons for the denial; and
Make available all information directly related to the denial.
Any policy or rider advertised, marketed or offered as long-term care or nursing home insurance shall comply with this chapter.
In addition to any other requirements under this chapter, the commissioner may require by rule that other information be given to the prospective applicant for long-term care insurance at the time of initial solicitation or thereafter.