Rhode Island Code of Regulations › Title 230 - Department of Business Regulation › Chapter 20 - Insurance › Subchapter 35 - Long Term Care Insurance › Part 1 - Long Term Care Insurance (formerly Insurance Regulation 44) › Section 230-RICR-20-35-1.10 - Initial Filing Requirements

Current through June 14, 2024
A. This section
				  applies to any long-term care policy issued in this state on or after December
				  1, 2008 except that §§
										1.10(B)(2)(d) and (B)(3)   apply to any long-term
				  care policy issued in this state on or after January 1, 2019.
B. An insurer shall provide the information
				  listed in this subsection to the Director (60) days prior to making a long-term
				  care insurance form available for sale.
1. A
				  copy of the disclosure documents required in §
											1.9   of this Part;
				  and
2. An actuarial certification
				  consisting of at least the following:
a. A
				  statement that the initial premium rate schedule is sufficient to cover
				  anticipated costs under moderately adverse experience and that the premium rate
				  schedule is reasonably expected to be sustainable over the life of the form
				  with no future premium increases anticipated;
b. A statement that the policy design and
				  coverage provided have been reviewed and taken into consideration;
c. A statement that the underwriting and
				  claims adjudication processes have been reviewed and taken into
				  consideration;
d. A statement that
				  the premiums contain at least the minimum margin for moderately adverse
				  experience defined in §
												1.10(B)(2)(d)   ((1)) of this Part or the
				  specification of and justification for a lower margin as required by
				  §
												1.10(B)(2)(d)   ((2)) of this Part.
(1) A
				  composite margin shall not be less than 10% of lifetime claims.
(2) A composite margin that is less than 10%
				  may be justified in uncommon circumstances. The proposed amount, full
				  justification of the proposed amount and methods to monitor developing
				  experience that would be the basis for withdrawal of approval for such lower
				  margins must be submitted.
(3) A
				  composite margin lower than otherwise considered appropriate for the standalone
				  long-term care policy may be justified for long-term care benefits provided
				  through a life policy or an annuity contract. Such lower composite margin, if
				  utilized, shall be justified by appropriate actuarial demonstration addressing
				  margins and volatility when considering the entirety of the product.
(4) A greater margin may be appropriate in
				  circumstances where the company has less credible experience to support its
				  assumptions used to determine the premium rates.
e. A statement that the premium rate schedule
				  is not less than the premium rate schedule for existing similar policy forms
				  also available from the issuer except for reasonable differences attributable
				  to benefits; or
f. A comparison of
				  the premium schedules for similar policy forms that are currently available
				  from the issuer with an explanation of the differences.
g. A statement that reserve requirements have
				  been reviewed and considered. Support for this statement shall include:
(1) Sufficient detail or sample calculations
				  provided so as to have a complete depiction of the reserve amounts to be held;
				  and
(2) A statement that the
				  difference between the gross premium and the net valuation premium for renewal
				  years is sufficient to cover expected renewal expenses; or if such a statement
				  cannot be made, a complete description of the situations where this does not
				  occur. An aggregate distribution of anticipated issues may be used as long as
				  the underlying gross premiums maintain a reasonably consistent
				  relationship.
3. An actuarial memorandum prepared, dated
				  and signed by the member of the Academy of Actuaries shall be included and
				  shall address and support each specific item required as part of the actuarial
				  certification and provide at least the following information:
a. An explanation of the review performed by
				  the actuary prior to making the statements in §§
												1.10(B)(2)(b) and (c)
				    of this Part,
b. A complete
				  description of pricing assumptions; and
c. Sources and levels of margins incorporated
				  into the gross premiums that are the basis for the statement in
				  §
												1.10(B)(2)(a)   of this Part the actuarial certification and an explanation
				  of the analysis and testing performed in determining the sufficiency of the
				  margins. Deviations in margins between ages, sexes, plans or states shall be
				  clearly described. Deviations in margins required to be described are other
				  than those produced utilizing generally accepted actuarial methods for
				  smoothing and interpolating gross premium scales.
d. A demonstration that the gross premiums
				  include the minimum composite margin specified in §
												1.10(B)(2)(d)   of this
				  Part.