Current through Register Vol. 56, No. 18, September 16, 2024
(a) Each carrier
offering long-term care insurance shall, as a protection against unintentional
lapse, comply with the following:
1. Notice
before lapse or termination.
i. No individual
long-term care policy or group certificate shall be issued until the carrier
has received from the applicant either a written designation of at least one
person, in addition to the applicant, who is to receive notice of lapse or
termination of the policy or certificate for nonpayment of premium or required
contribution, or a written waiver dated and signed by the applicant electing
not to designate an additional person to receive notice. The applicant has the
right to designate at least one person who is to receive the notice of
termination, in addition to the insured. Designation shall not constitute
acceptance of any liability by the third party for services provided to the
insured. The form used for the written designation must provide space clearly
earmarked for listing at least one person. The designation shall include each
person's full name and home address. In the case of an applicant who elects not
to designate an additional person, the waiver shall state: "Protection against
unintended lapse. I understand that I have the right to designate at least one
person other than myself to receive notice of lapse or termination of this
long-term care insurance for non-payment of premium or required contribution. I
understand that notice will not be given until 30 days after a premium is due
and unpaid. I elect NOT to designate any person to receive this notice." The
carrier shall notify the insured in writing in a clear and conspicuous manner
of the right to change this written designation, no less often than once every
two years for insureds who have not attained sixty-two and a half years and no
less than annually for insureds who have attained age sixty-two and a half
years of age.
ii. When the
policyholder or certificate holder pays premium for long- term care insurance
coverage through a payroll or pension deduction plan, the requirements
contained in (a)1; above need not be met until 60 days after the policyholder
or certificate holder is no longer on such a payment plan. The application or
enrollment form for such policies or certificates shall clearly indicate the
payment plan selected by the applicant.
2. Lapse or termination for non-payment of
premium. No individual long-term care policy or group certificate shall lapse
or be terminated for nonpayment of premium or required contribution unless the
carrier, at least 30 days before the effective date of the lapse or
termination, has given written notice to the insured and to those persons
designated pursuant to (a)1 above, at the address provided by the insured for
purposes of receiving notice of lapse or termination. Notice shall be given by
first class United States mail, postage prepaid; and notice may not be given
until 30 days after a premium or contribution is due and unpaid. Notice shall
be deemed to have been given as of five days after the date of
mailing.
(b) Restoration
of Coverage: In addition to the requirement in (a) above, a long-term care
insurance policy or group certificate shall include a provision that provides
for restoration of coverage in the event of lapse, if the carrier is provided
proof that the policyholder or certificate holder was cognitively impaired or
had a loss of functional capacity before a premium or contribution was required
to be paid. This option shall be available to the insured if requested within
five months after termination and shall allow for the collection of past due
premium or contributions, where appropriate. The standard of proof of cognitive
impairment or loss of functional capacity shall not be more stringent than the
benefit eligibility criteria for cognitive impairment or the loss of functional
capacity contained in the policy and certificate.
