Arizona Administrative Code › Title 20 - COMMERCE, FINANCIAL INSTITUTIONS, AND INSURANCE › Chapter 06 - DEPARTMENT OF INSURANCE AND FINANCIAL INSTITUTIONS - INSURANCE DIVISION › Article 10 - LONG-TERM CARE INSURANCE › Section R20-6-1005 - Unintentional Lapse

Current through Register Vol. 30, No. 28, July 12, 2024
A. An insured
				may designate in writing at least one person to receive notice of lapse or
				termination of a long-term care insurance policy for nonpayment of premium, in
				addition to the insured. Designation shall not constitute acceptance of any
				liability by the third-party notice recipient for services provided to the
				insured.
B. An insurer shall not
				issue an individual long-term care insurance policy or certificate until the
				applicant has provided either a written designation of at least one person, in
				addition to the applicant, who shall receive notice of lapse or termination of
				the policy or certificate for nonpayment of premium, with the person's full
				name and home address, or the applicant's written waiver, dated and signed,
				indicating that the applicant chooses not to designate a notice
				recipient.
C. The insurer shall use
				a form for written designation or waiver that provides space clearly delineated
				for the designation. The insurer shall include the following language on the
				form for waiver of the right to name a designated recipient: "Protection
				against unintended lapse. I understand that I have the right to designate at
				least one person other than myself to receive notice of lapse or termination of
				this long-term care insurance policy for nonpayment of premium. I understand
				that this notice will not be given until 30 days after a premium is due and
				unpaid. I elect NOT to designate a person to receive this notice."
D. At least once every two years, an insurer
				shall notify the insured of the right to change the person designated to
				receive notice in subsection (A). An insured may add, delete, or change a
				designated recipient or change a designated recipient at any time by notifying
				the insurer in writing, and providing the name and home address for the new
				designated recipient or the designated recipient to be deleted.
E. If the insured pays premiums for the
				long-term care insurance policy or certificate through a payroll or pension
				deduction plan, the insurer is not required to comply with the requirements in
				subsections (A) through (D) until 60 days after the insured is no longer on the
				payment plan.
F. An individual
				long-term care insurance policy shall not lapse or be terminated for nonpayment
				of premium unless the insurer gives the insured and any recipient designated
				under subsections (A) through (D) written notice at least 30 days before the
				effective date of termination or lapse, by first class mail, postage prepaid,
				at the address provided by the insured for purposes of receiving notice of
				lapse or termination. An insurer shall not give notice until 30 days after the
				date on which a premium is due and unpaid. Notice is deemed given five days
				after the date of mailing.
G.
				Reinstatement. In addition to the requirement in subsections (A) through (D), a
				long-term care insurance policy or certificate shall include a provision that
				provides for reinstatement of coverage in the event of a lapse if the insurer
				is provided proof that the policy-holder or certificateholder was cognitively
				impaired or had a loss of functional capacity before the grace period contained
				in the policy expired. This option shall be available to the insured if
				requested within five months after termination and shall allow for the
				collection of past due premium, where appropriate. The standard of proof of
				cognitive impairment or loss of functional capacity shall not be more stringent
				than the benefit eligibility criteria on cognitive impairment or the loss of
				functional capacity contained in the policy or certificate. Reinstatement after
				termination for other than unintentional lapse shall be governed by A.R.S.
				§
									20-1348.