(a) Application forms shall include the
following questions designed to elicit information as to 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 another accident and sickness or long-term
care policy or certificate presently in force. A supplementary application or
form to be signed by the applicant and producer, except when the coverage is
sold without a producer, containing the questions may be used. With regard to a
replacement policy issued to a group defined by section 1103 of the act
(
40
P. S. §
991.1103), 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 that the certificateholder has been notified of the
replacement.
(1) Do you have another
long-term care insurance policy or certificate in force (including health care
service contract or health maintenance organization contract)?
(2) Did you have another long-term care
insurance policy or certificate in force during the last 12 months?
(i) If so, with which company?
(ii) If that policy lapsed, when did it
lapse?
(3) Are you
covered by Medicaid? If you are eligible or covered by Medicaid, you may not
need to purchase the policy since it may provide duplicate benefits.
(4) Do you intend to replace any of your
medical or health insurance coverage with this policy [certificate]?
(b) Producers shall list health
insurance policies they have sold to the applicant.
(1) List policies sold that are still in
force.
(2) List policies sold in
the past 5 years that are no longer in force.
(c) 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 the 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 [insurance 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.
STATEMENT TO APPLICANT BY PRODUCER [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 that 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 or Other Representative)
[Typed Name and Address of producer]
The above "Notice to Applicant" was delivered to me
on:
____________
(Applicant's Signature)
____________
(Date)
(d) 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 [insurance 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]
(e) 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,
the name of the insured and policy number or address including zip code. Notice
shall be made within 5 working days from the date the application is received
by the insurer or the date the policy is issued, whichever is sooner.
(f) The insurer shall maintain records
demonstrating delivery date of policies so that this date can be used to
determine the commencement of the 30-day policy examination period. Delivery
date shall be deemed the date the policy is received by the
policyholder.
