Current through Register Vol. XLI, No. 38, September 20, 2024
Each insurer offering long-term care insurance shall, as a
protection against unintentional lapse, comply with the following:
5.1.
5.1.a.
Notice before lapse or termination. No individual long-term care policy or
certificate shall be issued until the insurer 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 a written waiver dated and signed by the applicant
electing not to designate additional persons 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 on the third party for services provided to the insured. The form
used for the written designation must provide space clearly designated 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 policy for nonpayment of premium. I understand that notice
will not be given until thirty (30) days after a premium is due and unpaid. I elect
NOT to designate a person to receive this notice." The insurer shall notify the
insured of the right to change this written designation, no less often than once
every two (2) years.
5.1.b. When the
policyholder or certificate holder pays premium for a long-term care insurance
policy or certificate through a payroll or pension deduction plan, the requirements
contained in subdivision a of this subsection need not be met until sixty (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.
5.1.c. Lapse or termination for nonpayment of
premium. No individual long-term care policy or certificate shall lapse or be
terminated for nonpayment of premium unless the insurer, at least thirty (30) days
before the effective date of the lapse or termination, has given notice to the
insured and to those persons designated pursuant to subdivision a of this
subsection, 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 thirty (30) days after a premium
is due and unpaid. Notice shall be deemed to have been given as of five (5) days
after the date of mailing.
5.2. Reinstatement. In addition to the requirement
in subsection 5.1 of this section, a long-term care insurance policy or certificate
shall include a provision that provides for reinstatement of coverage, in the event
of lapse if the insurer is provided proof that the policyholder or certificate
holder was cognitively impaired or had a loss of functional capacity before the
grace period contained in the policy expired. This option shall be available to the
insured if requested within five (5) months after termination and shall allow for
the collection of past due premium, where appropriate. The standard of proof of
cognitive impairment or loss of functional capacity shall not be more stringent than
the benefit eligibility criteria on cognitive impairment or the loss of functional
capacity contained in the policy and certificate.
