Ill. Admin. Code tit. 50, § 2012.125 - Availability of New Services or Providers
a) An insurer shall notify policyholders of
the availability of a new long-term care policy series that provides coverage
for new long-term care services or providers that are material in nature and
not previously available through the insurer to the general public. The notice
shall be provided within 12 months after the date the new policy series is made
available for sale in this State. New long-term care services or providers that
are material in nature shall not include changes to policy structure or
benefits or provisions that are minor in nature. Examples of when notification
need not be provided include changes in elimination periods, benefit periods
and benefit amounts.
b)
Notwithstanding subsection (a), notification is not required for any policy
issued prior to July 2008, or to any policyholder or certificateholder who is
currently eligible for benefits, within an elimination period or on claim, or
who previously has been in claim status, or who would not be eligible to apply
for coverage due to issue age limitations under the new policy. The insurer may
require that policyholders meet all eligibility requirements, including
underwriting and payment of the required premium to add new services or
providers.
c) The insurer shall
make the new coverage available in one of the following ways:
1) By adding a rider to the existing policy
and charging a separate premium for the new rider based on the insured's
attained age;
2) By exchanging the
existing policy or certificate for one with an issue age based on the present
age of the insured and recognizing past insured status by granting premium
credits toward the premiums for the new policy or certificate. The premium
credits shall be based on premiums paid or reserves held for the prior policy
or certificate;
3) By exchanging
the existing policy or certificate for a new policy or certificate in which
consideration for past insured status shall be recognized by setting the
premium for the new policy or certificate at the issue age of the policy or
certificate being exchanged. The cost for the new policy or certificate may
recognize the difference in reserves between the new policy or certificate and
the original policy or certificate; or
4) By an alternative program (such as
underwriting concessions) developed by the insurer that meets the intent of
this Section if the program is filed with and approved by the
Director.
d) An insurer
is not required to notify policyholders of a new proprietary policy series
created and filed for use in a limited distribution channel. For purposes of
this subsection, "limited distribution channel" means through a discrete
entity, such as a financial institution or brokerage, for which specialized
products are available that are not available for sale to the general public.
Policyholders that purchased such a proprietary policy shall be notified when a
new long-term care policy series that provides coverage for new long-term care
services or providers that are material in nature is made available to that
limited distribution channel.
e)
Policies issued pursuant to this Section shall be considered exchanges and not
replacements. These exchanges shall not be subject to Sections
2012.90
and
2012.123 of this
Part, and the reporting requirements of Section
2012.95(a) through
(e) of this Part.
f) When the policy is offered through an
employer, labor organization or professional, trade or occupational
association, the required notification in subsection (a) shall be made to the
offering entity. However, if the policy is issued to a group defined in Section
351A-1(e)(4) of the Code, the notification shall be made to each
certificateholder.
g) Nothing in
this Section shall prohibit an insurer from offering any policy, rider,
certificate or coverage change to any policyholder or certificateholder.
However, upon request, any policyholder may apply for currently available
coverage that includes the new services or providers. The insurer may require
that policyholders meet all eligibility requirements, including underwriting
and payment of the required premium to add new services or providers.
h) This Section does not apply to life
insurance policies or riders containing accelerated long-term care
benefits.
i) The provisions of this
Section apply on and after January 1, 2009.
Notes
Added at 32 Ill. Reg. 7600, effective May 5, 2008
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