Illinois Administrative Code › Title 50 - INSURANCE › Part 2007 - MINIMUM STANDARDS OF INDIVIDUAL ACCIDENT AND HEALTH INSURANCE › Section 2007.80 - Required Disclosure Provisions

Current through Register Vol. 48, No. 28, July 12, 2024
a) General Rules
1) Each individual policy of accident and
			 health insurance shall include a renewal, continuation or nonrenewal provision.
			 The language or specifications of the provision must be consistent with the
			 requirements of 50 Ill. Adm. Code 2001. Subpart A and the type of plan issued.
			 The provision shall be appropriately captioned, shall appear on the first page
			 of the policy, and shall clearly state the duration, when limited, of
			 renewability and the duration of the term of coverage for which the policy is
			 issued and for which it may be renewed.
2) Except for riders or endorsements by which
			 the insurer effectuates a request made in writing by the policyholder or
			 exercises a specifically reserved right under the policy, all riders or
			 endorsements added to a policy after date of issue or at reinstatement or
			 renewal that reduce or eliminate benefits or coverage in the policy shall
			 require signed acceptance by the policyholder. After date of policy issue, any
			 rider or endorsement that increases benefits or coverage with a concomitant
			 increase in premium during the policy term must be agreed to by the insured,
			 except if the increased benefits or coverage is required by law.
3) When a separate additional premium is
			 charged for benefits provided in connection with riders or endorsements, the
			 premium charge shall be set forth in the policy.
4) 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 those
			 terms and an explanation of those terms in its accompanying outline of
			 coverage.
5) If a policy providing
			 excepted benefits or a grandfathered health plan contains any limitations with
			 respect to preexisting conditions, those limitations must appear as a separate
			 paragraph of the policy and be labeled as "Preexisting Condition
			 Limitations".
6) All accident only
			 policies shall contain a prominent statement on the first page of the policy or
			 attached to the policy in either contrasting color or in boldface type at least
			 equal to the size of type used for policy captions, a prominent statement as
			 follows:
"This is an accident only policy and it does not pay benefits
				for loss from sickness."
7)
			 All policies, except single premium nonrenewal policies, shall have a notice
			 prominently printed on the first page of the policy or attached thereto stating
			 in substance, that the policyholder shall have the right to return the policy
			 within 10 days after its delivery and to have the premium refunded if after
			 examination of the policy the policyholder is not satisfied for any
			 reason.
8) If age is to be used as
			 a determining factor for reducing the maximum aggregate benefits made available
			 in the policy as originally issued, that fact must be prominently set forth in
			 the outline of coverage.
9) If a
			 policy contains a conversion privilege, it shall comply, in substance, with the
			 following: the caption of the provision shall be "Conversion Privilege", or
			 words of similar import. The provision shall indicate the persons eligible for
			 conversion, the circumstances applicable to the conversion privilege, including
			 any limitations on the conversion, and the person by whom the conversion
			 privilege may be exercised. The provision shall specify the benefits to be
			 provided on conversion or may state that the converted coverage will be as
			 provided on a policy form then being used by the insurer for that
			 purpose.
10) All specified disease
			 policies shall contain a prominent statement on the first page of the policy in
			 contrasting color and in bold face type at least equal to the size of type used
			 for policy captions, a prominent statement as follows: "This is a limited
			 policy. Read it carefully."
11)
			 Notice Requirements:
A) At the time of
			 purchase of fixed indemnity contracts, the fixed indemnity insurer must provide
			 notice within the application indicating that the fixed indemnity is not
			 minimum essential coverage (MEC) within the meaning of
			 26 USC
			 5000A(f) and does not
			 satisfy the ACA individual mandate. That notice must contain the following
			 verbiage displayed prominently in the plan materials in at least 14-point type
			 that has the following language:
"THIS IS A SUPPLEMENT TO HEALTH INSURANCE AND IS NOT A
				SUBSTITUTE FOR MAJOR MEDICAL COVERAGE. LACK OF MAJOR MEDICAL COVERAGE (OR OTHER
				MINIMUM ESSENTIAL COVERAGE) MAY RESULT IN AN ADDITIONAL PAYMENT WITH YOUR
				TAXES."
B) The notice
			 requirement of subsection (a)(11)(A) applies to all hospital or other fixed
			 indemnity insurance policy years beginning on or after January 1,
			 2015.
C) These notice requirements
			 do not apply to individual hospital indemnity or other fixed indemnity
			 insurance policies issued before January 1, 2015 that do not require an
			 application as a condition of renewal, are guaranteed renewable or
			 non-cancelable, and only condition renewal on the timely payment of premiums
			 with no renewal application form required.
D) These notice requirements apply only to
			 hospital indemnity or other fixed indemnity insurance policies sold in the
			 individual market. They do not apply to any other type or category of insurance
			 that is listed separately as an excepted benefit in the federal Public Health
			 Service Act (42 USC ch. 6A) (e.g., disability income insurance, specified
			 disease insurance, accident only insurance, etc.), regardless of whether the
			 benefits under that coverage are paid as a fixed dollar amount per day or other
			 period, or per service.
E) These
			 notice requirements do not apply to individual hospital indemnity or other
			 fixed indemnity insurance policyholders who are age 65 or older and are
			 enrolled in Medicare.