(1) This rule shall apply as follows:
(a) Except as provided in Paragraph (1)(b) of
this rule, this rule applies to any long-term care policy or certificate issued
in this state on or after six (6) months after the effective date of this
rule.
(b) For certificates issued
on or after the effective date of this amended rule under a group long-term
care insurance policy as defined in this Chapter, which policy was in force at
the time this amended rule became effective, the provisions of this rule shall
apply on the policy anniversary following twelve (12) months after the
effective date of this rule.
(2) Other than policies for which no
applicable premium rate or rate schedule increases can be made, insurers shall
provide all of the information listed in this paragraph to the applicant at the
time of application or enrollment, unless the method of application does not
allow for delivery at that time. In such a case, an insurer shall provide all
of the following information to the applicant no later than at the time of
delivery of the policy or certificate:
(a) A
statement that the policy may be subject to rate increases in the
future.
(b) An explanation of
potential future premium rate revisions, and the policyholder's or certificate
holder's option in the event of a premium rate revision.
(c) The premium rate or rate schedules
applicable to the applicant that will be in effect until a request is made for
an increase.
(d) A general
explanation for applying premium rate or rate schedule adjustments that shall
include:
1. A description of when premium rate
or rate schedule adjustments will be effective (e.g., next anniversary date,
next billing date, etc.); and
2.
The right to a revised premium rate or rate schedule as provided in Paragraph
(2)(c) of this rule if the premium rate or rate schedule is changed.
(e)
1. Information regarding each premium rate
increase on this policy form or similar policy forms over the past ten (10)
years for this state or any other state that, at a minimum, identifies:
(i) The policy forms for which premium rates
have been increased;
(ii) The
calendar years when the form was available for purchase; and
(iii) The amount or percent of each increase.
The percentage may be expressed as a percentage of the premium rate prior to
the increase, and may also be expressed as minimum and maximum percentages if
the rate increase is variable by rating characteristics.
2. The insurer may, in a fair manner, provide
additional explanatory information related to the rate increases.
3. An insurer shall have the right to exclude
from the disclosure premium rate increases that only apply to blocks of
business acquired from other nonaffiliated insurers or the long-term care
policies acquired from other nonaffiliated insurers when those increases
occurred prior to the acquisition.
4. If an acquiring insurer files for a rate
increase on a long-term care policy form acquired from nonaffiliated insurers
or a block of policy forms acquired from nonaffiliated insurers on or before
the later of the effective date of this rule or the end of a twenty-four (24)
month period following the acquisition of the block or policies, the acquiring
insurer may exclude that rate increase from the disclosure. However, the
nonaffiliated selling company shall include the disclosure of that rate
increase in accordance with Paragraph (2)(a) of this rule.
5. If the acquiring insurer in Paragraph
(2)(e)4. of this rule files for a subsequent rate increase, even within the
twenty-four (24) month period, on the same policy form acquired from
nonaffiliated insurers or block of policy forms acquired from nonaffiliated
insurers referenced in subparagraph 4. of this rule, the acquiring insurer must
make all disclosures required by Paragraph (5) of this rule, including
disclosure of the earlier rate increase referenced in Paragraph (2)(d) of this
rule.
(3) An
applicant shall sign an acknowledgement at the time of application, unless the
method of application does not allow for signature at that time, that the
insurer made the disclosure required by this rule. If due to the method of
application the applicant cannot sign an acknowledgement at the time of
application, the applicant shall sign no later than at the time of delivery of
the policy or certificate.
(4) An
insurer shall use the forms in Appendices D and I of this Chapter to comply
with the requirements of this rule.
(5) An insurer shall provide notice of an
upcoming premium rate schedule increase to all policyholders or certificate
holders, if applicable, at least forty-five (45) days prior to the
implementation of the premium rate schedule increase by the insurer. The notice
shall include the information required by Paragraph (2) of this rule when the
rate increase is implemented.
