North Carolina Administrative Code › Title 11 - INSURANCE › Chapter 12 - LIFE AND HEALTH DIVISION › Section .1000 - LONG TERM CARE INSURANCE › Section 12 .1015 - STANDARD FORMAT OUTLINE OF COVERAGE

Current through Register Vol. 39, No. 2, July 15, 2024
(a) The
				outline of coverage shall be a free-standing document, using no smaller than
				ten-point type.
(b) The outline of
				coverage shall contain no material of an advertising nature.
(c) Text that is capitalized or underscored
				in the standard format outline of coverage may be emphasized by other means
				that provide prominence equivalent to the capitalization or
				underscoring.
(d) Use of the text
				and sequence of text of the standard format outline of coverage is mandatory,
				unless otherwise specifically indicated.
(e) Format for outline of coverage:
[COMPANY NAME]
[ADDRESS - CITY & STATE]
[TELEPHONE NUMBER]
LONG-TERM CARE INSURANCE
OUTLINE OF COVERAGE
[Policy Number or Group Master Policy and Certificate
				  Number]
[Except for policies or certificates which are guaranteed
				  issue, the following caution statement, or language substantially similar, must
				  appear as follows in the outline of coverage.]
Caution: The issuance of this long-term care insurance
				  [policy] [certificate] is based upon your responses to the questions on your
				  application. A copy of your [application] [enrollment form] [is enclosed] [was
				  retained by you when you applied]. If your answers are incorrect or untrue, the
				  company has the right to deny benefits or rescind your policy. The best time to
				  clear up any questions is now, before a claim arises! If, for any reason, any
				  of your answers are incorrect, contact the company at this address: [insert
				  address]
1. This policy is [an
				individual policy of insurance] ([a group policy] which was issued in the
				[indicate jurisdiction in which group policy was issued]).
2. PURPOSE OF OUTLINE OF COVERAGE. This
				outline of coverage provides a very brief description of the important features
				of the policy. You should compare this outline of coverage to outlines of
				coverage for other policies available to you. This is not an insurance
				contract, but only a summary of coverage. Only the individual or group policy
				contains governing contractual provisions. This means that the policy or group
				policy sets forth in detail the rights and obligations of both you and the
				insurance company. Therefore, if you purchase this coverage, or any other
				coverage, it is important that you READ YOUR POLICY (OR CERTIFICATE)
				CAREFULLY!
3. FEDERAL TAX
				CONSEQUENCES.
This [POLICY] [CERTIFICATE] is intended to be a federally
				  tax-qualified long-term care insurance contract under Section 7702B(b) of the
				  Internal Revenue Code of 1986, as amended.
OR
Federal Tax Implications of this [POLICY] [CERTIFICATE]. This
				  [POLICY] [CERTIFICATE] is not intended to be a federally tax-qualified
				  long-term care insurance contract under Section 7702B(b) of the Internal
				  Revenue Code of 1986 as amended. Benefits received under the [POLICY]
				  [CERTIFICATE] may be taxable as income.
4. TERMS UNDER WHICH THE POLICY OR
				CERTIFICATE MAY BE CONTINUED IN FORCE OR DISCONTINUED.
(a) [For long-term care health insurance
				policies or certificates describe one of the following permissible policy
				renewability provisions:
(1) Policies and
				certificates that are guaranteed renewable shall contain the following
				statement:] RENEWABILITY: THIS POLICY [CERTIFICATE] IS GUARANTEED RENEWABLE.
				This means you have the right, subject to the terms of your policy,
				[certificate] to continue this policy as long as you pay your premiums on time.
				[Company Name] cannot change any of the terms of your policy on its own, except
				that, in the future, IT MAY INCREASE THE PREMIUM YOU PAY.
(2) [Policies and certificates that are
				noncancellable shall contain the following statement:] RENEWABILITY: THIS
				POLICY [CERTIFICATE] IS NONCANCELLABLE. This means that you have the right,
				subject to the terms of your policy, to continue this policy as long as you pay
				your premiums on time. [Company Name] cannot change any of the terms of your
				policy on its own and cannot change the premium you currently pay. However, if
				your policy contains an inflation protection feature where you choose to
				increase your benefits, [Company Name] may increase your premium at that time
				for those additional benefits.
(b) [For group coverage, specifically
				describe continuation/conversion provisions applicable to the certificate and
				group policy;]
(c) [Describe waiver
				of premium provisions or state that there are not such provisions.]
5. TERMS UNDER WHICH THE COMPANY
				MAY CHANGE PREMIUMS.
[In bold type larger than the maximum type required to be
				  used for the other provisions of the outline of coverage, state whether or not
				  the company has a right to change the premium, and if a right exists, describe
				  clearly and concisely each circumstance under which the premium may
				  change.]
6. TERMS UNDER
				WHICH THE POLICY OR CERTIFICATE MAY BE RETURNED AND PREMIUM REFUNDED.
(a) [Provide a brief description of the right
				to return-"free look" provision of the policy.]
(b) [Include a statement that the policy
				either does or does not contain provisions providing for a refund or partial
				refund of premium upon the death of an insured or surrender of the policy or
				certificate. If the policy contains such provisions, include a description of
				them.]
7. THIS IS NOT
				MEDICARE SUPPLEMENT COVERAGE. If you are eligible for Medicare, review the
				Medicare Supplement Buyer's Guide available from the insurance company.
(a) [For agents] Neither [insert company
				name] nor its agents represent Medicare, the federal government or any state
				government.
(b) [For direct
				response] [insert company name] is not representing Medicare, the federal
				government or any state government.
8. LONG-TERM CARE COVERAGE. Policies of this
				category are designed to provide coverage for one or more necessary or
				medically necessary diagnostic, preventive, therapeutic, rehabilitative,
				maintenance, or personal care services, provided in a setting other than an
				acute care unit of a hospital, such as in a nursing home, in the community or
				in the home.
This policy provides coverage in the form of a fixed dollar
				  indemnity benefit for covered long-term care expenses, subject to policy
				  [limitations] [waiting periods] and [coinsurance] requirements. [Modify this
				  paragraph if the policy is not an indemnity policy.]
9. BENEFITS PROVIDED BY THIS POLICY.
(a) [Covered services, related deductibles,
				waiting periods, elimination periods and benefit maximums.]
(b) [Institutional benefits, by skill
				level.]
(c) [Non-institutional
				benefits, by skill level.]
(d)
				Eligibility for Payment of Benefits
[Activities of daily living and cognitive impairment shall be
				  used to measure an insured's need for
long-term care and must be defined and described as part of
				  the outline of coverage.]
[Any additional benefit triggers must also be explained. If
				  these triggers differ for different benefits, explanation of the triggers must
				  accompany each benefit description. If an attending physician or other
				  specified person must certify a certain level of functional dependency in order
				  to be eligible for benefits, this too must be specified.]
10. LIMITATIONS AND EXCLUSIONS.
[Describe:
(a)
				Preexisting conditions;
(b)
				Non-eligible facilities and provider;
(c) Non-eligible levels of care (e.g.,
				unlicensed providers, care or treatment provided by a family member,
				etc.);
(d) Exclusions and
				exceptions;
(e) Limitations.]
[This section must provide a brief specific description of
				  any policy provisions that limit, exclude, restrict, reduce, delay, or in any
				  other manner operate to qualify payment of the benefits described in Number 6
				  above.]
THIS POLICY MAY NOT COVER ALL THE EXPENSES ASSOCIATED WITH
				  YOUR LONG-TERM CARE NEEDS.
11. RELATIONSHIP OF COST OF CARE AND
				BENEFITS. Because the costs of long-term care services will likely increase
				over time, you should consider whether and how the benefits of this plan may be
				adjusted. [As applicable, indicate the following:
(a) That the benefit level will not increase
				over time;
(b) Any automatic
				benefit adjustment provisions;
(c)
				Whether the insured will be guaranteed the option to buy additional benefits
				and the basis upon which benefits will be increased over time if not by a
				specified amount or percentage;
(d)
				If there is such a guarantee, include whether additional underwriting or health
				screening will be required, the frequency and amounts of the upgrade options,
				and any restrictions or limitations;
(e) And finally, describe whether there will
				be any additional premium charge imposed, and how that is to be
				calculated.]
12.
				ALZHEIMER'S DISEASE AND OTHER ORGANIC BRAIN DISORDERS.
[State that the policy provides coverage for insureds
				  clinically diagnosed as having Alzheimer's disease or related degenerative and
				  dementing illnesses. Specifically describe each benefit screen or other policy
				  provision which provides preconditions to the availability of policy benefits
				  for such an insured.]
13.
				PREMIUM.
[(a) State the total annual premium
				for the policy;
(b) If the premium
				varies with an applicant's choice among benefit options, indicate the portion
				of annual premium which corresponds to each benefit option.]
14. ADDITIONAL FEATURES.
[(a) Indicate if medical underwriting is
				used;
(b) Describe other important
				features.]
15. CONTACT
				THE NORTH CAROLINA SENIORS' HEALTH INSURANCE INFORMATION PROGRAM (SHIIP) IF YOU
				HAVE GENERAL QUESTIONS REGARDING LONG-TERM CARE INSURANCE. CONTACT THE
				INSURANCE COMPANY IF YOU HAVE SPECIFIC QUESTIONS REGARDING YOUR LONG-TERM CARE
				INSURANCE POLICY OR CERTIFICATE.