Pennsylvania Code › Title 31 - INSURANCE › Part IV - Life Insurance › Chapter 89a - LONG-TERM CARE INSURANCE MODEL REGULATION › Section 89a.103 - Definitions

Current through Register Vol. 54, No. 28, July 13, 2024
The following words and terms, when used in this chapter,
				  have the following meanings, unless the context clearly indicates otherwise:
Act
-The Insurance Company Law of 1921
				  (40
				  P. S. §§
										341-991.2361)
Applicant
-The term as defined in section
				  1103 of the act (40 P. S. §
										991.1103).
Certificate
-The term as defined in section
				  1103 of the act.
Commissioner
-The Insurance Commissioner of
				  the Commonwealth.
Department
-The Insurance Department of the
				  Commonwealth.
Exceptional increase
-Only those increases
				  filed by an insurer as exceptional for which the Commissioner determines the
				  need for the premium rate increase is justified.
(i) Increases due to changes in laws or
				regulations applicable to long-term care coverage in this Commonwealth or due
				to increased and unexpected utilization that affects the majority of insurers
				of similar products.
(ii) Except as
				provided in §
									89a.118 (relating to premium rate
				schedule increases), exceptional increases are subject to the same requirements
				as other premium rate schedule increases.
(iii) The Commissioner may request a review
				by an independent actuary or a professional actuarial body of the basis for a
				request that an increase be considered an exceptional increase.
(iv) The Commissioner, in determining that
				the necessary basis for an exceptional increase exists, will also determine
				potential offsets to higher claims costs.
Functionally necessary
-The term as defined
				  in section 1103 of the act.
Group long-term care insurance
-The term as
				  defined in section 1103 of the act.
Incidental
-As used in §
									89a.118(j), means
				  that the value of the long-term care benefits provided is less than 10% of the
				  total value of the benefits provided over the life of the policy. These values
				  shall be measured as of the date of issue.
Long-term care insurance
-The term as defined
				  in section 1103 of the act.
Medically necessary
-The term as defined in
				  section 1103 of the act.
Policy
-The term as defined in section 1103
				  of the act.
Producer
-An agent as defined in section 601
				  of the act (40 P. S. §
										231), or a
				  broker as defined in section 621 of the act (40 P. S. §
										251).
Qualified actuary
-A member in good standing
				  of the American Academy of Actuaries.
Qualified long-term care insurance contract
or
Federally tax-qualified long-term care insurance
				  contract-
(i) An individual or
				group insurance contract that meets all of the following requirements of
				section 7702B(b) of the Internal Revenue Code of 1986 (IRC) (26 U.S.C.A. §
										77026B(b)) :
(A) The only insurance protection provided
				under the contract is coverage of qualified long-term care services. A contract
				may not fail to satisfy the requirements of this subparagraph by reason of
				payments being made on a per diem or other periodic basis without regard to the
				expenses incurred during the period to which the payments relate.
(B) The contract does not pay or reimburse
				expenses incurred for services or items to the extent that the expenses are
				reimbursable under Title XVIII of the Social Security Act (42 U.S.C.A. §§
											1395-1395gg g) or would be so
				reimbursable but for the application of a deductible or coinsurance amount. The
				requirements of this subparagraph do not apply to expenses that are
				reimbursable under Title XVIII of the Social Security Act only as a secondary
				payor. A contract may not fail to satisfy the requirements of this subparagraph
				by reason of payments being made on a per diem or other periodic basis without
				regard to the expenses incurred during the period to which the payments
				relate.
(C) The contract is
				guaranteed renewable, within the meaning of section 7702B(b)(1)(C) of the
				IRC.
(D) The contract does not
				provide for a cash surrender value or other money that can be paid, assigned,
				pledged as collateral for a loan, or borrowed.
(E) All refunds of premiums and all
				policyholder dividends or similar amounts, under the contract are to be applied
				as a reduction in future premiums or to increase future benefits, except that a
				refund on the event of death of the insured or a complete surrender or
				cancellation of the contract cannot exceed the aggregate premiums paid under
				the contract.
(F) The contract
				meets the consumer protection provisions in section 7702B(g) of the
				IRC.