This section of the regulation implements, interprets and
makes specific, the provisions of Neb.Rev.Stat. §
44-4512
and §
44-4516
in prescribing a standard format and the content of an outline of
coverage.
026.01 The outline of
coverage shall be a free-standing document, using no smaller than ten point
type.
026.02 The outline of
coverage shall contain no material of an advertising nature.
026.03 Text which is capitalized or
underscored in the standard format outline of coverage may be emphasized by
other means which provide prominence equivalent to such capitalization or
underscoring.
026.04 Use of the
text and sequence of text of the standard format outline of coverage is
mandatory, unless otherwise specifically indicated.
026.05 Format for outline of coverage:
[COMPANY NAME]
[ADDRESS - CITY & STATE]
[TELEPHONE NUMBER]
LONG-TERM CARE INSURANCE
OUTLINE OF COVERAGE
[Policy Number or Group Master Policy and Certificate
Number]
[Except for policies or certificates which are guaranteed
issue, the following caution statement, or language substantially similar, must
appear as follows in the outline of coverage.]
Caution: The issuance of this long-term care insurance
[policy] [certificate] is based upon your responses to the questions on your
application. A copy of your [application] [enrollment form] [is enclosed] [was
retained by you when you applied]. If your answers are incorrect or untrue, the
company has the right to deny benefits or rescind your policy. The best time to
clear up any questions is now, before a claim arises! If, for any reason, any
of your answers are incorrect, contact the company at this address: [insert
address]
1. This policy is [an
individual policy of insurance] ([a group policy] which was issued in the
[indicate jurisdiction in which group policy was issued]).
2. PURPOSE OF OUTLINE OF COVERAGE. This
outline of coverage provides a very brief description of the important features
of the policy. You should compare this outline of coverage to outlines of
coverage for other policies available to you. This is not an insurance
contract, but only a summary of coverage. Only the individual or group policy
contains governing contractual provisions. This means that the policy or group
policy sets forth in detail the rights and obligations of both you and the
insurance company. Therefore, if you purchase this coverage, or any other
coverage, it is important that you READ YOUR POLICY (OR CERTIFICATE)
CAREFULLY!
3. FEDERAL TAX
CONSEQUENCES.
This [POLICY] [CERTIFICATE] is intended to be a federally
tax-qualified long-term care insurance contract under Section 7702B(b) of the
Internal Revenue Code of 1986, as amended.
OR
Federal Tax Implication of this [POLICY] [CERTIFICATE]. This
[POLICY] [CERTIFICATE] is not intended to be a federally a tax-qualified
long-term care insurance contract under Section 7702B(b) of the Internal
Revenue Code of 1986 as amended. Benefits received under the [POLICY]
[CERTIFICATE] may be taxable as income.
4. TERMS UNDER WHICH THE POLICY OR
CERTIFICATE MAY BE CONTINUED IN FORCE OR DISCONTINUED
(a) [For long-term care health insurance
policies or certificates describe one of the following permissible policy
renewability provisions:
(1) Policies and
certificates that are guaranteed renewable shall contain the following
statement:] RENEWABILITY: THIS POLICY [CERTIFICATE] IS GUARANTEED RENEWABLE.
This means you have the right, subject to the terms of your policy,
[certificate] to continue this policy as long as you pay your premiums on time.
[Company Name] cannot change any of the terms of your policy on its own, except
that, in the future, IT MAY INCREASE THE PREMIUM YOU PAY.
(2) [Policies and certificates that are
noncancellable shall contain the following statement:] RENEWABILITY: THIS
POLICY [CERTIFICATE] IS NONCANCELLABLE. This means that you have the right,
subject to the terms of your policy, to continue this policy as long as you pay
your premiums on time. [Company Name] cannot change any of the terms of your
policy on its own and cannot change the premium you currently pay. However, if
your policy contains an inflation protection feature where you choose to
increase your benefits, [Company Name] may increase your premium at that time
for those additional benefits.
(b) [For group coverage, specifically
describe continuation/conversion provisions applicable to the certificate and
group policy;]
(c). [Describe
waiver of premium provisions or state that there are not such
provisions;]
(d) [State whether or
not the company has a right to change premium, and if such right exists,
describe clearly and concisely each circumstance under which premium may
change.]
5. TERMS UNDER
WHICH THE POLICY OR CERTIFICATE MAY BE RETURNED AND PREMIUM REFUNDED.
(a) [Provide a brief description of the right
to return - "free look" provision of the policy".]
(b) [Include a statement that the policy
either does or does not contain provisions providing for a refund or partial
refund of premium upon the death of an insured or surrender of the policy or
certificate. If the policy contains such provisions, include a description of
them.]
6. THIS IS NOT
MEDICARE SUPPLEMENT COVERAGE. If you are eligible for Medicare, review the
Medicare Supplement Buyer's Guide available from the insurance company.
(a) [For agents] Neither [insert company
name] nor its agents represent Medicare, the federal government or any state
government.
(b) [For direct
response] [insert company name] is not representing Medicare, the federal
government or any state government.
7. LONG-TERM CARE COVERAGE. Policies of this
category are designed to provide coverage for one or more necessary or
medically necessary diagnostic, preventive, therapeutic, rehabilitative,
maintenance, or personal care services, provided in a setting other than an
acute care unit of a hospital, such as in a nursing home, in the community or
in the home.
This policy provides coverage in the form of a fixed dollar
indemnity benefit for covered long-term care expenses, subject to policy
[limitations] [waiting periods] and [coinsurance] requirements. [Modify this
paragraph if the policy is not an indemnity policy.]
8. BENEFITS PROVIDED BY THIS POLICY.
(a) [Covered services, related deductible(s),
waiting periods, elimination periods and benefit maximums.]
(b) [Institutional benefits, by skill
level.]
(c) [Non-institutional
benefits, by skill level.]
(d)
Eligibility for Payment of Benefits
[Activities of daily living and cognitive impairment shall be
used to measure an insured's need for long-term care and must be defined and
described as part of the outline of coverage.]
[Any additional benefit triggers must be explained. If these
triggers differ for different benefits, explanation of the triggers should
accompany each benefit description. If an attending physician or other
specified person must certify a certain level of functional dependency in order
to be eligible for benefits, this too must be
specified.]
9. LIMITATIONS AND EXCLUSIONS.
[Describe:
(a)
Preexisting conditions;
(b)
Non-eligible facilities and provider;
(c) Non-eligible levels of care (e.g.,
unlicensed providers, care or treatment provided by a family member,
etc.);
(d) Exclusions and
exceptions;
(e) Limitations.]
[This section should provide a brief specific description of
any policy provisions which limit, exclude, restrict, reduce, delay, or in any
other manner operate to qualify payment of the benefits described in (7)
above.]
THIS POLICY MAY NOT COVER ALL THE EXPENSES ASSOCIATED WITH
YOUR LONG- TERM CARE NEEDS.
10. RELATIONSHIP OF COST OF CARE AND
BENEFITS. Because the costs of long-term care services will likely increase
over time, you should consider whether and how the benefits of this plan may be
adjusted. [As applicable, indicate the following:
(a) That the benefit level will not increase
over time;
(b) Any automatic
benefit adjustment provisions;
(c)
Whether the insured will be guaranteed the option to buy additional benefits
and the basis upon which benefits will be increased over time if not by a
specified amount or percentage;
(d)
If there is such a guarantee, include whether additional underwriting or health
screening will be required, the frequency and amounts of the upgrade options,
and any significant restrictions or limitations;
(e) And finally, describe whether there will
be any additional premium charge imposed, and how that is to be
calculated.]
11.
ALZHEIMER'S DISEASE AND OTHER ORGANIC BRAIN DISORDERS.
[State that the policy provides coverage for insureds
clinically diagnosed as having Alzheimer's disease or related degenerative and
dementing illnesses. Specifically describe each benefit screen or other policy
provision which provides preconditions to the availability of policy benefits
for such an insured.]
12.
PREMIUM.
(a) [State the total annual premium
for the policy;
(b) If the premium
varies with an applicant's choice among benefit options, indicate the portion
of annual premium which corresponds to each benefit option.]
13. ADDITIONAL FEATURES.
(a) [Indicate if medical underwriting is
used;
(b) Describe other important
features.]