(1) Application
forms shall include the following questions designed to elicit information
whether, as of the date of the application, the applicant has another
long-term
care insurance policy or
certificate in force or whether a long-term care
policy or
certificate is intended to replace any other accident and sickness or
long-term care policy or
certificate presently in force. A supplementary
application or other form to be signed by the applicant and
producer, except
where the coverage is sold without a
producer, containing such questions may be
used. With regard to a replacement policy issued to a group defined by Iowa
Code section
514G.103(9)
"a," the following questions may be
modified only to the extent necessary to elicit information about health or
long-term care insurance policies other than the group policy being replaced;
provided, however, that the
certificate holder has been notified of the
replacement.
a. Do you have another long-term
care insurance policy or certificate in force (including health care service
contract, health maintenance organization contract)?
b. Did you have another
long-term care
insurance policy or
certificate in force during the last 12 months?
(1) If so, with which company?
(2) If that policy lapsed, when did it
lapse?
c. Are you
covered by Medicaid?
d. Do you
intend to replace any of your medical or health insurance coverage with this
policy [certificate]?
(2) Producers shall list any other health
insurance policies they have sold to the applicant.
a. List policies sold which are still in
force.
b. List policies sold in the
past five years which are no longer in force.
(3) Solicitations other than direct response.
Upon determining that a sale will involve replacement, an insurer, other than
an insurer using direct response solicitation methods, or its
producer, shall
furnish the applicant, prior to issuance or delivery of the individual
long-term care insurance policy, a notice regarding replacement of accident and
sickness or long-term care coverage. One copy of such notice shall be retained
by the applicant and an additional copy signed by the applicant shall be
retained by the insurer. The required notice shall be provided in the following
manner:
NOTICE TO APPLICANT REGARDING REPLACEMENT OF INDIVIDUAL
ACCIDENT AND SICKNESS OR LONG-TERM CARE INSURANCE
[Insurance company's name and address]
SAVE THIS NOTICE! IT MAY BE IMPORTANT TO YOU IN THE
FUTURE
According to [your application] [information you have
furnished], you intend to lapse or otherwise terminate existing accident and
sickness or long-term care insurance and replace it with an individual
long-term care insurance policy to be issued by [company name]. Your new policy
provides ten days within which you may decide, without cost, whether you desire
to keep the policy. For your own information and protection, you should be
aware of and seriously consider certain factors which may affect the insurance
protection available to you under the new policy.
You should review this new coverage carefully, comparing it
with all accident and sickness or long-term care insurance coverage you now
have, and terminate your present policy only if, after due consideration, you
find that purchase of this long-term care coverage is a wise decision.
STATEMENT TO APPLICANT BY PRODUCER
[BROKER OR OTHER REPRESENTATIVE]:
(Use additional sheets, as necessary.)
I have reviewed your current medical or health insurance
coverage. I believe the replacement of insurance involved in this transaction
materially improves your position. My conclusion has taken into account the
following considerations, which I call to your attention.
1. Health conditions which you may presently
have (preexisting conditions) may not be immediately or fully covered under the
new policy. This could result in denial or delay in payment of benefits under
the new policy, whereas a similar claim might have been payable under your
present policy.
2. State law
provides that your replacement policy or certificate may not contain new
preexisting conditions or probationary periods. The insurer will waive any time
periods applicable to preexisting conditions or probationary periods in the new
policy (or coverage) for similar benefits to the extent such time was spent
(depleted) under the original policy.
3. If you are replacing existing long-term
care insurance coverage, you may wish to secure the advice of your present
insurer or its producer regarding the proposed replacement of your present
policy. This is not only your right, but it is also in your best interest to
make sure you understand all the relevant factors involved in replacing your
present coverage.
4. If, after due
consideration, you still wish to terminate your present policy and replace it
with new coverage, be certain to truthfully and completely answer all questions
on the application concerning your medical health history. Failure to include
all material medical information on an application may provide a basis for the
company to deny any future claims and to refund your premium as though your
policy had never been in force. After the application has been completed and
before you sign it, reread it carefully to be certain that all information has
been properly recorded.
_____________________________________________
(Signature of Producer, Broker or Other
Representative)
[Typed Name and Address of Producer or Broker]
The above "Notice to Applicant" was delivered to me
on:
_____________________________________________
(Date)
_____________________________________________
(Applicant's Signature)
(4) Direct response solicitations. Insurers
using direct response solicitation methods shall deliver a notice regarding
replacement of accident and sickness or long-term care coverage to the
applicant upon issuance of
the policy. The required notice shall be provided in
the following manner:
NOTICE TO APPLICANT REGARDING REPLACEMENT OF ACCIDENT AND
SICKNESS OR LONG-TERM CARE INSURANCE
[Insurance company's name and address]
SAVE THIS NOTICE! IT MAY BE IMPORTANT TO YOU IN THE
FUTURE
According to [your application] [information you have
furnished], you intend to lapse or otherwise terminate existing accident and
sickness or long-term care insurance and replace it with the long-term care
insurance policy delivered herewith issued by [company name]. Your new policy
provides 30 days within which you may decide, without cost, whether you desire
to keep the policy. For your own information and protection, you should be
aware of and seriously consider certain factors which may affect the insurance
protection available to you under the new policy.
You should review this new coverage carefully, comparing it
with all accident and sickness or long-term care insurance coverage you now
have, and terminate your present policy only if, after due consideration, you
find that purchase of this long-term care coverage is a wise decision.
1. Health conditions which you may presently
have (preexisting conditions) may not be immediately or fully covered under the
new policy. This could result in denial or delay in payment of benefits under
the new policy, whereas a similar claim might have been payable under your
present policy.
2. State law
provides that your replacement policy or certificate may not contain new
preexisting conditions or probationary periods. Your insurer will waive any
time periods applicable to preexisting conditions or probationary periods in
the new policy (or coverage) for similar benefits to the extent such time was
spent (depleted) under the original policy.
3. If you are replacing existing long-term
care insurance coverage, you may wish to secure the advice of your present
insurer or its producer regarding the proposed replacement of your present
policy. This is not only your right, but it is also in your best interest to
make sure you understand all the relevant factors involved in replacing your
present coverage.
4. [To be
included only if the application is attached to
the policy.] If, after due
consideration, you still wish to terminate your present policy and replace it
with new coverage, read the copy of the application attached to your new policy
and be sure that all questions are answered fully and correctly. Omissions or
misstatements in the application could cause an otherwise valid claim to be
denied. Carefully check the application and write to [company name and address]
within 30 days if any information is not correct and complete, or if any past
medical history has been left out of the application.
(Company Name)
(5) Where replacement is intended, the
replacing insurer shall notify, in writing, the existing insurer of the
proposed replacement. The existing policy shall be identified by the insurer,
name of the insured and policy number or address including zip code. Such
notice shall be made within five working days from the date the application is
received by the insurer or the date the policy is issued, whichever is
sooner.
(6) Life insurance policies
that accelerate benefits for long-term care shall comply with this subrule if
the policy being replaced is a
long-term care insurance policy. If
the policy
being replaced is a life insurance policy, the insurer shall comply with the
replacement requirements of 191-Chapter 16. If a life insurance policy that
accelerates benefits for long-term care is replaced by another such policy, the
replacing insurer shall comply with both the long-term care and the life
insurance replacement requirements.
This rule is intended to implement Iowa Code section
514D.9
and chapter 514G.
