(1) Policy expiration.
(a) A policy and certificate shall include:
(i) an expiration provision that specifies
the conditions for renewal or extension; and
(ii) the total number of months or days for
the full term of contract, pursuant to Subsection R590-286-5(1)(c).
(b) The provision shall be
appropriately captioned and appear on the first page of the policy and
certificate.
(c) Considering any
renewal or extension, a short-term limited duration health insurance policy or
certificate is limited to 36 months.
(2) Rights of spouse. The following
provisions apply to policies that provide coverage to a spouse of the insured:
(a) A policy or certificate may not provide
for termination of coverage of the spouse solely because of the occurrence of
an event specified for termination of coverage of the insured, other than for
nonpayment of premium.
(b) A policy
or certificate shall provide that in the event of the insured's death the
spouse of the insured shall become the insured.
(3) Applications.
(a) Questions used to elicit health condition
information may not be vague and must reference a reasonable time frame in
relation to the health condition.
(b) A completed application shall be made
part of the policy. A copy of the completed application shall be provided to
the applicant prior to or upon delivery of the policy.
(c) Each application shall contain a
prominent statement by type, stamp or other appropriate means in either
contrasting color or boldface type at least equal to the size type used for the
headings or captions of sections of the application and in close conjunction
with the applicant's signature block on the application as follows, "Short-Term
Limited Duration Health Insurance provides limited benefits. The
(policy)(certificate), either by itself or bundled with other limited benefit
products, is not meant to replace comprehensive health care insurance. It does
not include benefits required by the PPACA. Review your (policy)(certificate)
carefully."
(d) A statement
regarding any preexisting waiting period as required by Subsection
31A-22-605.1(5)(b).
(e) An application form shall include a
question designed to elicit information as to whether the insurance to be
issued is intended to replace any other accident and health insurance presently
in force. A supplementary application or other form to be signed by the
applicant containing the question may be used.
(4) Endorsement acceptance.
(a) Except for an endorsement by which the
insurer effectuates a request made in writing by the policyholder, an
endorsement added to a policy after date of issue that reduces or eliminates
benefits or coverage in the policy shall require signed acceptance by the
policyholder.
(b) After the date
of policy issue, an endorsement that increases benefits or coverage with a
concurrent increase in premium during the policy term, must be agreed to in
writing signed by the policyholder, except if the increased benefits or
coverage is required by law.
(5) Additional premium. Where a separate
additional premium is charged for benefits provided in connection with an
endorsement, the premium charge shall be set forth in the policy and
certificate.
(6) Benefit payment
standard. A policy that provides for the payment of benefits based on standards
described as usual and customary, reasonable and customary, or words of similar
import, shall include a definition of the terms and an explanation of the terms
in its accompanying outline of coverage or certificate.
(7) Preexisting conditions. If a policy or
certificate contains any limitations with respect to preexisting conditions,
the limitations shall appear as a separate paragraph of the policy and
certificate and be labeled as "Preexisting Condition Limitation."
(a) The limitation shall include a
description of the existence and terms of any preexisting condition exclusion
under the policy, including the maximum preexisting exclusion period;
and
(b) state that the exclusion
period ends no later than 12 months after the first issuance of the policy or
certificate.
(8) Notice
to Buyer.
Any short-term limited duration health insurance policy or
certificate shall display prominently on the first page of the policy or
certificate, in either contrasting color or in boldface type at least equal to
the size type used for headings or captions of section in the policy or
certificate, the following:
"Notice to Buyer: This coverage is not required to comply
with certain federal market requirements for comprehensive health insurance,
principally those contained in the Affordable Care Act. Be sure to read your
(policy)(certificate) carefully to make sure you are aware of any exclusions or
limitations regarding coverage of preexisting conditions or health benefits,
such as hospitalization, emergency services, maternity care, preventive care,
prescription drugs, and mental health and substance use disorder services. Your
(policy)(certificate) might also have lifetime and/or annual dollar limits on
health benefits. If this coverage expires or you lose eligibility for this
coverage, you might have to wait until an open enrollment period to get other
health insurance coverage."
(9) Termination of the policy shall be
without prejudice to a continuous loss or deterioration of health that
commenced while the policy or certificate was in force, limited to the duration
of the benefit period or payment of the maximum benefits.
