Current through Register Vol. 48, No. 12, March 22, 2024
a)
In applying Section
2005.30
to determine if an insured received consultation, advice or treatment from a
physician for a disease, illness, sickness, malady or condition, the
consultation, advice or treatment must be clearly indicated in the insured's
medical records or from the statements of the insured's legally qualified
physician or other relevant evidence.
1) If
an application contains conflicting answers, or if an answer is clearly
incomplete, the insurer has an obligation to investigate further. For example,
if a question about medical history is answered with the name of a physician,
but there is no statement concerning the condition treated or the reason for
the visit, the insurer has an obligation to investigate further. An insurer
failing to make that investigation and then taking appropriate action would be
estopped from using a "pre-existing condition" or "pre-existing illness" as
grounds for denying the claim or rescinding the policy for the particular
disease, illness, sickness, malady or condition.
2) If a particular disease, illness,
sickness, malady or condition was not diagnosed by a legally qualified
physician before the effective date of the coverage for the insured, but
symptomatology was evident regardless of consultation, advice or treatment by a
legally qualified physician, the disease or condition will not be considered
pre-existing if there were interrogatories appropriate to the symptoms on the
application for insurance and if the symptoms were disclosed on the application
for insurance and the insurer did not make an investigation and take
appropriate action.
3) If there was
no application or the interrogatories on any application for insurance were not
appropriate to the symptoms, a legally qualified physician must decide if the
symptomatology was sufficient prior to the effective date of the policy to make
a diagnosis and demonstrate manifestation of the disease, illness, sickness,
malady or condition.
4) In the
administration of this Section, if the Medical Director, similar employee or
other physician retained by the insurer who qualifies as a legally qualified
physician decides the medical questions of Section
2005.30(a)(2)
or (a)(3), the physician shall notify either
the insured or his or her attending physician or other legally qualified
physician of the insured of all of the relevant facts supporting the decision.
If the attending physician or other legally qualified physician of the insured
offers facts that demonstrate there is good reason that the disease, illness,
sickness, malady or condition did not exist prior to the effective date of
coverage for the insured, the definition of a pre-existing illness must be
construed favorably for the insured.
b) A legally qualified physician is a
physician as defined and licensed under the Medical Practice Act [225 ILCS 60
].
c) The insurer may rescind a
policy only if it can demonstrate the insured has withheld material information
or answered material questions incorrectly on an application that would have
resulted in the insurer, at the time of original application:
1) denying coverage; or
2) restricting (i.e., decreasing) the level
or coverage applied for; or
3)
rating up (i.e., increasing) the premium normally charged for the coverage
applied for.
d) No
answers to questions in an application for insurance such as "Are you in good
health?" or "Are you free from disease or impairment?" shall be used alone to
rescind the policy unless the false answers to those questions, along with the
other evidence, clearly demonstrates justification for rescission of the
policy.
e) After the coverage for
the insured has been in effect for two years, the coverage may not be rescinded
except for fraud. To establish fraud, the insurer must meet the requirements of
Illinois law in this regard.