Iowa Administrative Code › Agency 191 - Insurance Division › Life and Health Insurance › Chapter 39 - Long-term Care Insurance › Rule 191-39.22 - Unintentional Lapse

Current through Register Vol. 47, No. 3, July 24, 2024
(1) Notice
				before lapse or termination. No individual long-term care policy or certificate
				shall be issued until the insurer has received from the applicant either: a
				written designation of at least one person, in addition to the applicant, who
				is to receive notice of lapse or termination of the policy or certificate for
				nonpayment of premium; or a written waiver dated and signed by the applicant
				electing not to designate additional persons to receive notice. The applicant
				has the right to designate at least one person who is to receive the notice of
				termination, in addition to the insured. Designation shall not constitute
				acceptance of any liability on the third party for services provided to the
				insured. The form used for the written designation must provide space clearly
				designated for listing at least one person. The designation shall include each
				person's full name and home address. In the case of an applicant who elects not
				to designate an additional person, the waiver shall state: "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
				notice will not be given until 30 days after a premium is due and impaid. I
				elect NOT to designate any person to receive such notice."
The insurer shall notify the insured of the right to change
				  this written designation no less often than once every two years.
(2) When the policyholder or
				certificate holder pays premium for a long-term care insurance policy or
				certificate through a payroll or pension deduction plan, the requirements
				contained in subrule 39.22(1) need not be met until 60 days after the
				policyholder or certificate holder is no longer on such a payment plan. The
				application or enrollment form for such policies or certificates shall clearly
				indicate the payment plan selected by the applicant.
(3) Lapse or termination for nonpayment of
				premium. No individual long-term care policy or certificate shall lapse or be
				terminated for nonpayment of premium imless the insurer, at least 30 days
				before the effective date of the lapse or termination, has given notice to the
				insured and to those persons designated pursuant to subrule 39.22(1) at the
				address provided by the insured for purposes of receiving notice of lapse or
				termination. Notice shall be given by first-class United States mail, postage
				prepaid; and notice may not be given imtil 30 days after a premium is due and
				unpaid. Notice shall be deemed to have been given as of five days after the
				date of mailing.
(4) Reinstatement.
				In addition to the requirement in subrule 39.22(1), a long-term care insurance
				policy or certificate shall include a provision which provides for
				reinstatement of coverage in the event of lapse if the insurer is provided
				proof of cognitive impairment or the loss of functional capacity. 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, if any,
				contained in the policy and certificate.