(a) All
applications for short term care policies except those that are guaranteed
issue shall contain clear and unambiguous questions designed to ascertain the
health condition of the applicant.
(b) If an application for short term care
insurance contains a question that asks whether the applicant has had
medication prescribed, it shall also ask the applicant to list the medication
that has been prescribed. If the medications listed in such application were
known by the insurer or should have been known at the time of application to be
directly related to a medical condition for which coverage would otherwise be
denied, then the policy shall not be rescinded for that condition.
(c) Except for policies that are guaranteed
issue:
(1) The following language shall be set
out conspicuously and in close conjunction with the applicant's signature block
on an application for a short term care policy:
Caution: If your answers on this application are
incorrect or untrue, (company) has the right to deny benefits or rescind your
policy.
(2) The
following language or language substantially similar to the following, shall be
set out conspicuously on the short term care policy at the time of delivery:
Caution: The issuance of this short term care insurance
policy is based upon your responses to the questions on your application. A
copy of your application (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).
(d) A copy of the
completed application shall be delivered to the insured no later than at the
time of delivery of the policy unless it was retained by the applicant at the
time of application.
(e) Every
insurer selling or issuing short term care insurance coverage shall maintain a
record of all policy rescissions, both statewide and nationally, except those
that the insured voluntarily effectuated.
