Current through Register Vol. 50, No. 9, September 20, 2024
A. Every insurer shall maintain records for
each producer of that producer's amount of replacement sales as a percentage of
the producer's total annual sales and the amount of lapses of long-term care
insurance policies sold by the producer as a percentage of the producer's total
annual sales.
B. Each insurer shall
report annually, by June 30, the 10 percent of its producers with the greatest
percentages of lapses and replacements, as measured by
§1927. A (§1969,
Appendix G).
C. Reported
replacement and lapse rates do not alone constitute a violation of insurance
laws or necessarily imply wrongdoing. The reports are for the purpose of
reviewing more closely producer activities regarding the sale of long-term care
insurance.
D. Every insurer shall
report annually, by June 30, the number of lapsed policies as a percentage of
its total annual sales and as a percentage of its total number of policies in
force as of the end of the preceding calendar year (§1969, Appendix
G).
E. Every insurer shall report
annually, by June 30, the number of replacement policies sold as a percentage
of its total annual sales and as a percentage of its total number of policies
in force as of the preceding calendar year (§1969, Appendix G).
F. Every insurer shall report annually, by
June 30, for qualified long-term care insurance contracts, the number of claims
denied for each class of business, expressed as a percentage of claims denied
(§1969, Appendix E).
G. For
purposes of §1927:
1.
policy
means only long-term care insurance; and
2. subject to
§1927. G 3,
claim means a request for a payment of benefits under an in
force policy regardless of whether the benefit claimed is covered under the
policy or any terms or conditions of the policy have been met;
3.
denied means the insurer
refuses to pay a claim for any reason other than for claims not paid for
failure to meet the waiting period or because of an applicable preexisting
condition; and
4.
report means on a statewide basis.
H. Reports required under this Section shall
be filed with the commissioner.
I.
Annual rate certification requirements
1.Section 1927. I applies to
any long-term care policy issued in this state on or after January 1,
2018.
2. The following annual
submission requirements apply subsequent to initial rate filings for individual
long-term care insurance policies made under §1927:
a. an actuarial certification prepared,
dated, and signed by a member of the American Academy of Actuaries who provides
the information shall be included and shall provide at least the following
information:
i. a statement of the
sufficiency of the current premium rate schedule including:
(a). for the rate schedules currently
marketed:
(i). the premium rate schedule
continues to be sufficient to cover anticipated costs under moderately adverse
experience and that the premium rate schedule is reasonably expected to be
sustainable over the life of the form with no future premium increases
anticipated; or
(ii). if the above
statement cannot be made, a statement that margins for moderately adverse
experience may no longer be sufficient. In this situation, the insurer shall
provide to the commissioner, within 60 days of the date the actuarial
certification is submitted to the commissioner, a plan of action, including a
time frame, for the re-establishment of adequate margins for moderately adverse
experience so that the ultimate premium rate schedule would be reasonably
expected to be sustainable over the future life of the form with no future
premium increases anticipated. Failure to submit a plan of action to the
commissioner within 60 days or to comply with the time frame stated in the plan
of action constitutes grounds for the commissioner to withdraw or modify
approval of the form for future sales pursuant to
R.S.
22:972;
(b). for the rate schedules that are no
longer marketed:
(i). that premium rate
schedule continues to be sufficient to cover anticipated costs under best
estimate assumptions; or
(ii). that
the premium rate schedule may no longer be sufficient. In this situation the
insurer shall provide to the commissioner, within 60 days of the date the
actuarial certification is submitted to the commissioner, a plan of action,
including a time frame, for the re-establishment of adequate margins for
moderately adverse experience;
ii. a description of the review performed
that led to the statement;
b. an actuarial memorandum dated and signed
by a member of the American Academy of Actuaries who prepares the information
shall be prepared to support the actuarial certification and provide at least
the following information:
i. a detailed
explanation of the data sources and review performed by the actuary prior to
making the statement in
§1927. I.2
a;
ii. a complete description of
experience assumptions and their relationship to the initial pricing
assumptions;
iii. a description of
the credibility of the experience data;
iv. an explanation of the analysis and
testing performed in determining the current presence of margins;
c. the actuarial certification
required pursuant to
§1927. I.2.a must be
based on calendar year data and submitted annually no later than May 1 of each
year starting in the second year following the year in which the initial rate
schedules are first used. The actuarial memorandum required pursuant to
§1927. I.2.b must be
submitted at least once every three years with the certification.
AUTHORITY NOTE:
Promulgated in accordance with
R.S.
22:1186(A),
22:1186(E),
22:1188(C),
22:1189,
and
22:1190.
