New Mexico Administrative Code › Title 13 - INSURANCE › Chapter 10 - HEALTH INSURANCE › Part 15 - LONG-TERM CARE INSURANCE › Section 13.10.15.53 - APPENDIX E

Current through Register Vol. 35, No. 13, July 16, 2024
POTENTIAL RATE INCREASE DISCLOSURE FORM
Instructions:
This form provides information to the applicant
						  regarding premium rate schedules, rate schedule adjustments, potential rate
						  revisions, and policyholder options in the event of a rate increase.
Insurer shall provide all of the following information to the
						  applicant:
Long-term care Insurance
Potential rate
						  Increase Disclosure Form
1.
[Premium Rate][Premium Rate
						  Schedules]:
[Premium Rate][Premium Rate Schedules] that [is][are]
						  applicable to you and that will be in effect until a request is made and
						  approved for an increase [is][are] [on the application][$______] 2.
The
						  [premium][premium rate schedule] for this policy [will be shown on the schedule
						  page of][will be attached to] your policy.
3.
Rate Schedule
						  Adjustments:
The company will provide a description of when premium rate
						  or rate schedule adjustments will be effective (fill in the
						  blank):____________________________. 4.
Potential Rate Revisions:
This policy is Guaranteed Renewable.
This means that the rates
						  for this product may be increased in the future. Your rates can NOT be
						  increased due to your increasing age or declining health, but your rates may go
						  up based on the experience of all policyholders with a policy similar to yours.
If you receive a premium rate or premium rate schedule increase in the
						  future, you will be notified of the new premium amount and you will be able to
						  exercise a least one of the following options:
* Pay the increased
						  premium and continue your policy in force as is. * Reduce your policy benefits
						  to a level that your premiums will not increase. (Subject to state law minimum
						  standards.) * Exercise your nonforfeiture option if purchased. (This optionis
						  available for purchase for additioonal premium.) * Exercise your contingent
						  nonforfeiture rights* ( This option may be available if you do not purchase a
						  separate nonforfeiture option.)
* Contingent Nonforfeiture
If the
						  premium rate for your policy goes up in the future and you didn't buy a
						  nonforfeiture option, you may be eligible for contingent nonforfeiture. Here's
						  how to tell if you are eligible: You will keep some long-term care insurance
						  coverage, if: * Your premium after the increase exceeds your original premium
						  by the percentage shown (or more) in the following table; and * You lapse (not
						  pay more premiums) within 120 days of the increase. The amount of coverage
						  (i.e., new lifetime maximum benefit amount) you will keep will equal the total
						  amount of premiums you've paid since your policy was first issued. If you have
						  already received benefits under the policy, so that the remaining maximum
						  benefit amount is less than the total amount of premiums you've paid, the
						  amount of coverage will be that remaining amount. Except for this reduced
						  lifetime maximum benefit amount, all other policy benefits will remain at the
						  levels attained at the time of the lapse and will not increase thereafter.
						  Should you choose this Contingent Nonforfeiture option, your policy, with this
						  reduced maximum benefit amount, will be considered "paid-up" with no further
						  premiums due.
Example:
* You bought the policy at age 65 and paid
						  the $ 1,000 annual premium for 10 years, so you have paid a total of $ 10,000
						  in premium. * In the eleventh year, you received a rate increase of 50%, or $
						  500 for a new annual premium of $ 1,500, and you decide to lapse the policy
						  (not pay any more premiums). * Your "paid-up" policy benefits are $ 10,000
						  (provided you have at least $ 10,000 of benefits remaining under your policy.)
Contingent Nonforfeiture
Cumulative Premium Increase over
						  Initial Premium
That qualifies for Contingent Nonforfeiture
(Percentage increase is cumulative from the date of original issue. It does NOT
						  represent a one-time increase)
ISSUE AGE
PERCENT INCREASE OVER INITIAL PREMIUM
29 and under
200%
30-34
190%
35-39
170%
40-44
150%
45-49
130%
50-54
110%
55-59
90%
60
70%
61
66%
62
62%
63
58%
64
54%
65
50%
66
48%
67
46%
68
44%
69
42%
70
40%
71
38%
72
36%
73
34%
74
32%
75
30%
76
28%
77
26%
78
24%
79
22%
80
20%
81
19%
82
18%
83
17%
84
16%
85
15%
86
14%
87
13%
88
12%
89
11%
90 and over
10%