Authenticated PDF VersionThe purpose of this regulation is to implement 18 Del.C. Ch. 71, to promote the public interest, to promote the availability of long-term care insurance coverage, to protect applicants for long-term care insurance, from unfair or deceptive sales or enrollment practices, to facilitate public understanding and comparison of long-term care insurance coverages, regulate rescission, and to facilitate flexibility and innovation in the development of long-term care insurance.
This regulation is issued pursuant to the authority vested in the Commissioner under 18 Del.C. §§311, 7105 and 7107.
4.1 For the purpose of this regulation, the terms "Department," "long-term care insurance," "Commissioner," "applicant," "policy" and "certificate" shall have the meanings set forth in 18 Del.C. §§102 and 7103.
"Benefit Trigger", means a contractual provision in the insured's policy of long-term care insurance conditioning the payment of benefits on a determination of the insured's ability to perform activities of daily living and on cognitive impairment. For purposed of a tax-qualified long-term care insurance contract, as defined in Section 7702B of the Internal Revenue Code of 1986, as amended, "benefit trigger" shall include a determination by a licensed health care practitioner that an insured is a chronically ill individual.
"Exceptional increase" means only those increases filed by an insurer as exceptional for which the Commissioner determines the need for the premium rate increase is justified:
"Incidental," as used in subsection 20.10 of this regulation, means that the value of the long-term care benefits provided is less than ten percent (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.
"Qualified actuary" means a member in good standing of the American Academy of Actuaries.
"Similar policy forms" means all of the long-term care insurance policies and certificates issued by an insurer in the same long-term care benefit classification as the policy form being considered. Certificates of groups that meet the definition in 18 Del.C. §7103(4) a are not considered similar to certificates or policies otherwise issued as long-term care insurance, but are similar to other comparable certificates with the same long-term care benefit classifications. For purposes of determining similar policy forms, long-term care benefit classifications are defined as follows: institutional long-term care benefits only, non-institutional long-term care benefits only, or comprehensive long-term care benefits.
All providers of services, including but not limited to "skilled nursing facility", "extended care facility", "convalescent nursing home", "personal care facility", "specialized care providers", "assisted living facilities", and "home care agency" shall be defined in relation to the services and facilities required to be available and the licensure, certification, registration or degree status of those providing or supervising the services. When the definition requires that the provider be appropriately licensed, certified or registered, it shall also state what requirements a provider must meet in lieu of licensure, certification or registration when the state in which the service is to be furnished does not require a provider of these services to be licensed, certified or registered, or when the state licenses, certifies or registers the provider of services under another name.
“Activities of daily living” means at least bathing, continence, dressing, eating, toileting and transferring.
"Acute Condition" means that the individual is medically unstable. Such an individual requires frequent monitoring by medical professionals, such as physicians and registered nurses, in order to maintain their health status.
"Adult day care" means a program for six (6) or more individuals, of social and health-related services provided during the day in a community group setting for the purpose of supporting frail, impaired elderly or other disabled adults who can benefit from care in a group setting outside the home.
"Bathing" means washing oneself by sponge bath; or in either a tub or shower, including the task of getting into or out of the tub or shower.
“Chronically ill” means any individual who has been certified by a Licensed Health Care Practitioner as being unable to perform, without substantial assistance from another individual, at least two activities of daily living for a period of at least ninety (90) days; or who requires substantial supervision to protect such individual from threats to health and safety due to severe cognitive impairment.
“Cognitive impairment” means a deficiency in a person’s short-term or long-term memory, orientation as to person, place, and time, deductive or abstract reasoning, or judgment as it relates to safety awareness.
"Continence" means the ability to maintain control of bowel and bladder function; or, when unable to maintain control of bowel or bladder function, the ability to perform associated personal hygiene (including caring for catheter or colostomy bag).
"Dressing" means putting on and taking off all items of clothing and any necessary braces, fasteners or artificial limbs.
"Eating" means feeding oneself by getting food into the body from a receptacle or by feeding tube or intravenously.
"Hands-on Assistance" means physical assistance without which the individual would not be able to perform the activity of daily living.
"Home health care services" means medical and nonmedical services provided to ill, disabled or infirm persons in their residences. Such services may include homemaker services, assistance with activities of daily living and respite care services.
"Medicare" means "The Health Insurance for the Aged Act, Title XVIII of the Social Security Amendments of 1965 as then constituted or later amended," or "Title I, Part I of Public Law 89-97, as enacted by the Eighty-Ninth Congress of the United States of America and popularly known as the Health Insurance for the Aged Act, as then constituted and any later amendments or substitutes thereof," or words of similar import.
“Mental or nervous disorder" shall not be defined to include more than neurosis, psychoneurosis, psychopathy, psychosis, or mental or emotional disease or disorder.
"Personal care" means the provision of hands-on services to assist an individual with activities of daily living (such as bathing, eating, dressing, transferring and toileting).
"Preexisting Conditions" shall be defined in accordance with 18 Del.C. §7105 (c).
“Qualified Long-Term Care Insurance Policy” means a policy that provides coverage for qualified long-term care services that is intended to meet the requirements of Section 7702B(b) of the Internal Revenue Code of 1986, as amended.
“Qualified Long-Term Care Services” means necessary diagnostic, preventive therapeutic, curing, treating, mitigating and rehabilitative services and Maintenance or Personal Care Services which are required by a Chronically Ill Individual and are provided pursuant to a Plan of Care prescribed by a Licensed Health Care Practitioner.
"Skilled nursing care", "intermediate care", "personal care", "home care", and other services shall be defined in relation to the level of skill required, nature of the care and the setting in which care must be delivered.
"Toileting" means getting to and from the toilet, getting on and off the toilet, and performing associated functions.
"Transferring" means moving into or out of a bed, chair, or wheelchair.
All providers of services, including but not limited to "skilled nursing facility", "extended care facility", "intermediate care facility", "convalescent nursing home", "personal care facility", and "home care agency" shall be defined in relation to the services and facilities required to be available and the licensure or degree status of those providing or supervising the services. The definition may require that the provider be appropriately licensed or certified.
6.0 Policy Practices and Provisions
6.1.6 Cost Disclosure Information.
6.2.3 Alcoholism and drug addiction;
6.2.4 Illness, treatment or medical condition arising out of:
6.2.4.1 War or act of war (whether declared or undeclared);
6.2.4.2 Participation in a felony, riot or insurrection;
6.2.4.3 Service in the armed forces or units auxiliary thereto;
6.2.4.4 Suicide (sane or insane), attempted suicide or intentionally self-inflicted injury; or
6.2.4.5 Aviation (this exclusion applies only to non-fare-paying passengers).
6.4 Continuation or Conversion.
6.4.7 Continuation of coverage or issuance of a converted policy shall be mandatory, except where:
6.9 Electronic Enrollment for Group Policies
6.9.1 In the case of a group defined in 18 Del.C. §7103(4) a. any requirement that a signature of an insured be obtained by an agent or insurer shall be deemed satisfied if:
7.0 Required Disclosure Provisions
7.5 Other Limitations or Conditions on Eligibility for Benefits. A long-term care insurance policy or certificate containing any limitations or conditions for eligibility, except in accordance with 18 Del.C. §7105, shall set forth a description of such limitations or conditions, including any required number of days or confinement, in a separate paragraph of the policy or certificate and shall label such paragraph "Limitations or Conditions of Eligibility for Benefits."
7.6 Disclosure of Tax Consequences.
8.0 Required Disclosure of Rating Practices to Consumers and Agent of Record
8.1 Subsection 8.1 shall apply as follows:
8.1.1 Except as provided in subsection 8.1.2 of this regulation, Section 8.0 of this regulation applies to any long-term care policy or certificate issued in this state on or after March 1, 2005.
8.1.2 For certificates issued on or after the effective date of this amended regulation under a group long-term care insurance policy as defined in 18 Del.C. §7103(4)a, which policy was in force at the time this amended regulation became effective, the provisions of Section 8.0 of this regulation shall apply on the policy anniversary following January 1, 2006.
8.2 Other than policies for which no applicable premium rate or rate schedule increases can be made, insurers shall provide all of the information listed in subsection 8.2 of this regulation to the applicant at the time of application or enrollment, unless the method of application does not allow for delivery at that time. In such a case, an insurer shall provide all of the information listed in Section 8.0 of this regulation to the applicant no later than at the time of delivery of the policy or certificate.
8.2.1 A statement that the policy may be subject to rate increases in the future;
8.2.4.2 The right to a revised premium rate or rate schedule as provided in subsection 8.2.3 of this regulation if the premium rate or rate schedule is changed;
8.2.5 Premium rate increase information
8.2.5.1.1 The policy forms for which premium rates have been increased;
8.2.5.1.2 The calendar years when the form was available for purchase;
8.2.5.1.4 The current daily benefit amount under the policy;
8.2.5.1.6 The contingent non-forfeiture benefit available on lapse.
8.2.5.4 If an acquiring insurer files for a rate increase on a long-term care policy form acquired from nonaffiliated insurers or a block of policy forms acquired from nonaffiliated insurers on or before the later of the effective date of Section 8.0 of this regulation or the end of a twenty-four-month period following the acquisition of the block or policies, the acquiring insurer may exclude that rate increase from the disclosure. However, the nonaffiliated selling company shall include the disclosure of that rate increase in accordance with subsection 8.2.5.1 of this regulation.
8.2.5.5 If the acquiring insurer in subsection 8.2.5.4 of this regulation files for a subsequent rate increase, even within the twenty-four-month period, on the same policy form acquired from nonaffiliated insurers or block of policy forms acquired from nonaffiliated insurers referenced in subsection 8.2.5.4 of this regulation, the acquiring insurer shall make all disclosures required by subsection 8.2.5 of this regulation, including disclosure of the earlier rate increase referenced in subsection 8.2.5.4 of this regulation.
8.3 An applicant shall sign an acknowledgement at the time of application, unless the method of application does not allow for signature at that time, that the insurer made the disclosure required under subsections 8.2.1 and 8.2.5 of this regulation. If due to the method of application the applicant cannot sign an acknowledgement at the time of application, the applicant shall sign no later than at the time of delivery of the policy or certificate.
8.4 An insurer shall use the forms in Appendices B and F to comply with the requirements of subsections 8.2 and 8.3 of this regulation.
8.5 An insurer shall provide notice of an upcoming premium rate schedule increase to all policyholders or certificate holders, if applicable, at least forty-five (45) days prior to the implementation of the premium rate schedule increase by the insurer. The notice shall include the information required by subsection 8.2 of this regulation when the rate increase is implemented.
9.1.3 Lapse or termination for nonpayment of premium. No individual long-term care policy or certificate shall lapse or be terminated for nonpayment of premium unless the insurer, at least thirty (30) days before the effective date of the lapse or termination, has given notice to the insured and to those persons designated pursuant to subsection 9.1.1.1 of this regulation, 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 until thirty (30) days after a premium is due and unpaid. Notice shall be deemed to have been given as of five (5) days after the date of mailing.
9.2 Reinstatement. In addition to the requirement in subsection 9.1.1 of this regulation, a long-term care insurance policy or certificate shall include a provision that provides for reinstatement of coverage, in the event of lapse if the insurer is provided proof that the policyholder or certificate holder was cognitively impaired or had a loss of functional capacity before the grace period contained in the policy expired. This option shall be available to the insured if requested within five (5) 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 contained in the policy and certificate.
10.0 Initial Filing Requirements
10.1.1 A copy of the disclosure documents required in Section 8.0 of this regulation; and
10.1.2 An actuarial certification consisting of at least the following:
10.1.2.4.4.2 If the gross premiums for certain age groups appear to be inconsistent with this requirement, the commissioner may request a demonstration under subsection10.3 of this regulation based on a standard age distribution; and
10.2.2 In the event the commissioner asks for additional information under this provision, the period in subsection 10.2 of this regulation does not include the period during which the insurer is preparing the requested information.
11.0 Prohibition Against Post-Claims Underwriting
11.1 All applications for long-term care insurance policies or certificates except those which are guaranteed issue shall contain clear and unambiguous questions designed to ascertain the health condition of the applicant.
11.2 If an application for long-term care insurance contains a question which asks whether the applicant has had medication prescribed by a physician, it must also ask the applicant to list the medication that has been prescribed.
11.2.1 If the medications listed in such application were known by the insurer, or should have been known at the time of application, to be directly related to a medical condition for which coverage would otherwise be denied, then the policy or certificate shall not be rescinded for that condition.
11.3 Except for policies or certificates which are guaranteed issue:
11.3.1 The following language shall be set out conspicuously and in close conjunction with the applicant's signature block on an application for a long-term care insurance policy or certificate: Caution: If your answers on this application are incorrect or untrue [company] has the right to deny benefits or rescind your policy.
11.3.2 The following language, or language substantially similar to the following, shall be set out conspicuously on the long-term care insurance policy or certificate at the time of delivery: 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].
11.3.3 Prior to issuance of a long-term care insurance policy or certificate to an applicant age eighty (80) or older, the insurer shall obtain one of the following:
11.3.3.1 A report of a physical examination;
11.3.3.2 An assessment of functional capacity;
11.3.3.3 An attending physician's statement; or
11.3.3.4 Copies of medical records.
11.4 A copy of the completed application or enrollment form (whichever is applicable) shall be delivered to the insured no later than at the time of delivery of the policy or certificate unless it was retained by the applicant at the time of application.
11.5 Every insurer or other entity selling or issuing long-term care insurance benefits shall maintain a record of all policy or certificate rescissions, both state and countrywide, except those which the insured voluntarily effectuated and shall annually furnish this information to the Insurance Commissioner in the form prescribed by the National Association of Insurance Commissioners.
11.11 This section does not apply to the remaining death benefit of a life insurance policy in the event of the death of the insured if the policy accelerates benefits for long-term care. In this situation, the remaining death benefits under the life insurance policy are governed by 18 Del.C. §2929. In all other situations, this section shall apply to life insurance policies that accelerate benefits for long-term care.
12.0 Minimum Standards for Home Health and Community Care Benefits in Long-Term Care Insurance Policies
12.1 A long-term care insurance policy or certificate shall not, if it provides benefits for home health or community care services, limit or exclude benefits by:
12.1.1 Requiring that the insured/claimant would need skilled care in a skilled nursing facility if home health care services were not provided;
12.1.2 Requiring that the insured/claimant first or simultaneously receive nursing or therapeutic services or both in a home, community or institutional setting before home health care services are covered;
12.1.3 Limiting eligible services to services provided by registered nurses or licensed practical nurses;
12.1.4 Requiring that a nurse or therapist provide services covered by the policy that can be provided by a home health aide, or other licensed or certified home care worker acting within the scope of the certified home care worker’s licensure or certification;
12.1.5 Excluding coverage for personal care services provided by a home health aide;
12.1.6 Requiring that the provision of home health care services be at a level of certification or licensure greater than that required by the eligible service;
12.1.7 Requiring that the insured/claimant have an acute condition before home health care services are covered;
12.1.8 Limiting benefits to services provided by Medicare-certified agencies or providers; or
12.1.9 Excluding coverage for adult day care services.
12.2 A long-term care insurance policy or certificate, if it provides for home health or community care services, shall provide total home health or community care coverage that is a dollar amount equivalent to at least one-half of one year's coverage available for nursing home benefits under the policy or certificate. This requirement shall not apply to policies or certificates issued to residents of continuing care retirement communities.
12.3 Home health care coverage may be applied to non-home health care benefits provided in the policy or certificate when determining the maximum coverage under the terms of the policy or certificate.
13.0 Requirement to Offer Inflation Protection
13.1 No insurer may offer a long-term care insurance policy unless the insurer also offers to the policyholder the option to purchase a policy that provides for benefit levels to increase with benefit maximums or reasonable durations which are meaningful to account for reasonably anticipated increases in the costs of long-term services covered by the policy. Insurers must offer to each policyholder, at the time of purchase, the option to purchase a policy with an inflation protection feature no less favorable than one of the following:
13.1.1 Increases benefit levels annually in a manner so that the increases are compounded annually at a rate not less than five percent (5%). However, if the insured individual shall reject the inflation protection offer as provided for in Section 13.0 of this regulation, the insurer may offer other or alternate forms of inflation protection;
13.1.2 Guarantees the insured individual the right to periodically increase benefit levels without providing evidence of insurability or health status so long as the option for the previous period has not been declined. The amount of additional benefit shall be no less than the difference between the existing policy benefit and that benefit compounded annually at a rate of at least five percent (5%) for the period beginning with the purchase of the existing benefit and extended until the year in which the offer is made; or
13.1.3 Covers a specific percentage of actual or reasonable charges and does not include a maximum specified indemnity amount of limit.
13.2 Where the policy is issued to a group, the required offer in subsection 13.1 of this regulation shall be made to the group policyholder; except, if the policy is issued to a group defined in 18 Del.C. §7103(4), other than to a continuing care retirement community, the offering shall be made to each proposed certificate holder.
13.3 The offer in subsection 13.1 of this regulation shall not be required of life insurance policies or riders containing accelerated long-term care benefits.
13.4 Insurers shall include the following information in or with the outline of coverage:
13.4.1 A graphic comparison of the benefit levels of a policy that increases benefits over the policy period with a policy that does not increase benefits. The graphic comparison shall show benefit levels over at least a twenty (20) year period.
13.4.2 Any expected premium increases or additional premiums to pay for automatic or optional benefit increases. An insurer may use a reasonable hypothetical, or a graphic demonstration, for the purposes of this disclosure.
13.5 Inflation protection benefit increases under a policy which contains such benefits shall continue without regard to an insured's age, claim status or claim history, or the length of time the person has been insured under the policy.
13.6 An offer of inflation protection which provides for automatic benefit increases shall include an offer of a premium which the insurer expects to remain constant. Such offer shall disclose in a conspicuous manner that the premium may change in the future unless the premium is guaranteed to remain constant.
13.7 Inflation protection as provided in subsection 13.1.1 of this regulation shall be included in a long-term care insurance policy unless an insurer obtains a rejection of inflation protection signed by the policyholder as required in subsection 13.7 of this regulation.
13.7.1 The rejection shall be considered part of the application and shall state:
14.0 Requirements for Replacement
14.1 Application forms shall include the following questions designed to elicit information as to whether, as of the date of the application, the applicant has another long-term care insurance policy or certificate in force or whether a long-term care policy or certificate is intended to replace any accident and sickness or long-term care policy or certificate presently in force. A supplementary application or other form to be signed by the applicant and the agent, except where the coverage is sold without an agent, containing such questions may be used. With regard to a replacement policy issued to a group defined in 18 Del.C. §7103(4), the following questions may be modified only to the extent necessary to elicit information about health or long-term care insurance policies other than the group policy being replaced; provided, however, that the certificate holder has been notified of the replacement.
14.1.1 Do you have another long-term care insurance policy or certificate in force (including health care services contract, health maintenance organization contract)?
14.1.2 Did you have another long-term care insurance policy or certificate in force during the last twelve (12) months?
14.1.2.1 If so, with which company?
14.1.2.2 If that policy lapsed, when did it lapse?
14.1.3 Are you covered by Medicaid?
14.1.4 Do you intend to replace any of your medical or health insurance with this policy {certificate}?
14.2 Agents shall list any other health insurance policies they have sold to the applicant.
14.2.1 List policies sold which are still in force.
14.2.2 List policies sold in the last five (5) years which are no longer in force.
14.3 Solicitations Other than Direct Response. Upon determining that a sale will involve replacement, an insurer; other than an insurer using direct response solicitation methods, or its agent; shall furnish the applicant, prior to issuance or delivery of the individual long-term care insurance policy, a notice regarding replacement of accident and sickness or long-term care coverage. One copy of such notice shall be retained by the applicant and an additional copy signed by the applicant shall be retained by the insurer. The required notice shall be provided in the following manner:
NOTICE TO APPLICANT REGARDING REPLACEMENT OF INDIVIDUAL
ACCIDENT AND SICKNESS OR LONG-TERM CARE INSURANCE
STATEMENT TO APPLICANT BY AGENT
[BROKER OR OTHER REPRESENTATIVE]:
(Use additional sheets, as necessary).
_______________________________
_______________________________
The above "Notice to the Applicant" was delivered to me on:
________________________________
14.4 Direct Response Solicitations. Insurers using direct response solicitation methods shall deliver a notice regarding replacement of accident and sickness or long-term care coverage to the applicant upon issuance of the policy. The required notice shall be provided in the following manner:
NOTICE TO APPLICANT REGARDING REPLACEMENT OF INDIVIDUAL
ACCIDENT AND SICKNESS OR LONG-TERM CARE INSURANCE
14.5 Where replacement is intended, the replacing insurer shall notify, in writing, the existing insurer of the proposed replacement. The existing policy shall be identified by the name of the insurer, name of the insured and policy number or address including zip code. Such notice shall be made within five (5) working days from the date the application is received by the insurer or the date the policy is issued, whichever is sooner.
14.6 Life Insurance policies that accelerate benefits for long-term care shall comply with Section 14.0 of this regulation if the policy being replaced is a long-term care insurance policy. If the policy being replaced is a life insurance policy, the insurer shall comply with the replacement requirements of 18 DE Admin. Code 1204. If a life insurance policy that accelerates benefits for long-term care is replaced by another such policy, the replacing insurer shall comply with both the long-term care and the life insurance replacement requirements.
15.0 Reporting Requirements
15.1 Every insurer shall maintain records for each Delaware-licensed producer of that producer’s amount of replacement sales as a percentage of the producer’s total annual sales and the amount of lapses of long-term care insurance policies sold by the producer as a percent of the producer’s total annual sales.
15.2 Each insurer shall report annually by June 30 the ten percent (10%) of its Delaware-licensed producers with the greatest percentages of lapses and replacements as measured by subsection 15.1 of this regulation.
15.3 Reported replacement and lapse rates do not alone constitute a violation of insurance laws or necessarily imply wrongdoing. The reports are for the purpose of reviewing more closely producer activities regarding the sale of long-term care insurance.
15.4 Every entity providing long-term care insurance in this state shall file annually as an attachment to its annual statement an exhibit that discloses the total number of long-term care insurance policies, by form number, in force in this state and the total number of policies, by form number, that have lapsed over the previous five years. Companies must provide in-force policy and lapsed policy information in the following manner:
15.5 Every insurer shall report, annually by June 30 the number of replacement policies sold as a percentage of its total annual sales and as a percentage of its total number of policies in force as of the preceding calendar year.
15.6 For purposes of Section 15.0 of this regulation, "policy" shall mean only long-term care insurance and "report" shall mean on a statewide basis.
16.0 Licensing
16.1 No producer is authorized to market, sell, solicit or otherwise contact any person for the purpose of marketing long-term care insurance unless the producer has demonstrated knowledge of long-term care insurance and the appropriateness of such insurance by passing a test required by this state and maintaining appropriate licenses.
16.2 Producers shall comply with the licensing provisions contained in 18 Del.C. Ch. 17 and 18 DE Admin. Code 504, as the same may be amended or supplemented relating to lines of authority and examinations, respectively.
17.0 Discretionary Powers of Commissioner
17.1.1 The modification or suspension would be in the best interest of the insureds; and
17.1.2 The purposes to be achieved could not be effectively or efficiently achieved without the modification or suspension; and
17.2 The modification or suspension is necessary to the development of an innovative and reasonable approach for insuring long-term care; or
17.3 The policy or certificate is to be issued to residents of a life care or continuing care retirement community or some other residential community for the elderly and the modification or suspension is reasonable related to the special needs or nature of such a community; or
17.4 The modification or suspension is necessary to permit long-term care insurance to be sold as part of, or in conjunction with, another insurance product.
18.0 Reserve Standards
18.1 When long-term care benefits are provided through the acceleration of benefits under group or individual life policies or riders to such policies, policy reserves for such benefits shall be determined in accordance with 18 Del.C. §1113. Claim reserves must also be established in the case when such policy or rider is in claim status. Reserves for policies and riders subject to subsection 18.1 of this regulation should be based on the multiple decrement model utilizing all relevant decrements except for voluntary termination rates. Single decrement approximations are acceptable if the calculation produces essentially similar reserves, if the reserve is clearly more conservative, or if the reserve is immaterial. The calculations may consider the reduction in life insurance benefits due to the payment of long-term care benefits. However, in no event shall the reserves for the long-term care benefit and the life insurance benefit be less than the reserves for the life insurance benefit assuming no long-term benefit. In the development and calculation of reserves for policies and riders subject to subsection 18.1 of this regulation due regard shall be given to the applicable policy provisions, marketing methods, administrative procedures and all other considerations which have an impact on projected claim costs, including, but not limited to, the following:
18.3 When long-term care benefits are provided other than as in subsection 18.1 of this regulation, reserves shall be determined in accordance with 18 Del.C. §1108.
19.0 Loss Ratio
19.1 Section 19.0 of this regulation shall apply to all long-term care insurance policies or certificates except those covered under Sections 10.0 and 20.0 of this regulation.
19.2.1 Statistical credibility of incurred claims experience and earned premiums;
19.2.2 The period for which rates are computed to provide coverage;
19.2.3 Experienced and projected trends;
19.2.4 Concentration of experience within early policy duration;
19.2.5 Expected claim fluctuation;
19.2.6 Experience refunds, adjustments or dividends;
19.2.8 All appropriate expense factors;
19.2.10 Experimental nature of the coverage;
19.2.12 Mix of business by risk classification; and
19.2.13 Product features such as long elimination periods, high deductibles and high maximum limits.
19.3 Subsection 19.2 of this regulation shall not apply to life insurance policies that accelerate benefits for long-term care. A life insurance policy that funds long-term care benefits entirely by accelerating the death benefit is considered to provide reasonable benefits in relation to premiums paid, if the policy complies with all of the following provisions:
19.3.2 The portion of the policy that provides life insurance benefits meets the nonforfeiture requirements of 18 Del.C. §2929;
19.3.3 The policy meets the disclosure requirements of 18 Del.C. §7105;
19.3.4 Any policy illustration that meets the applicable requirements of 18 DE Admin. Code 1210; and
19.3.5 An actuarial memorandum is filed with the insurance department that includes:
19.3.5.1 A description of the basis on which the long-term care rates were determined;
19.3.5.2 A description of the basis for the reserves;
19.3.5.6 The estimated average annual premium per policy and the average issue age;
20.0 Premium Rate Schedule Increases
20.1 Section 20.0 of this regulation shall apply as follows:
20.1.1 Except as provided in subsection 20.1.2 of this regulation, Section 20.0 of this regulation applies to any long-term care policy or certificate issued in this state on or after September 1, 2005.
20.1.2 For certificates issued on or after May 1, 1999 under a group long-term care insurance policy as defined in 18 Del.C. §7103(4), which policy was in force at the time this amended regulation became effective, the provisions of Section 20.0 of this regulation shall apply on the policy anniversary following January 1, 2006.
20.2.1 Information required by Section 8.0 of this regulation;
20.2.2 Certification by a qualified actuary that:
20.2.2.2 The premium rate filing is in compliance with the provisions of Section 20.0 of this regulation;
20.2.3 An actuarial memorandum justifying the rate schedule change request that includes:
20.2.3.1.3 The projections shall demonstrate compliance with subsection 20.3 of this regulation; and
20.2.3.1.4 For exceptional increases,
20.2.3.1.4.2 In the event the commissioner determines as provided in subsection 4.1.4 of this regulation that offsets may exist, the insurer shall use appropriate net projected experience;
20.2.5 Sufficient information for review of the premium rate schedule increase by the commissioner.
20.3.2.1 The accumulated value of the initial earned premium times fifty-eight percent (58%);
20.3.2.4 Eighty-five percent (85%) of the present value of future projected premiums not in subsection 20.3.2.3 of this regulation on an earned basis;
20.3.3 In the event that a policy form has both exceptional and other increases, the values in subsections 20.3.2.2 and 20.3.2.4 of this regulation will also include seventy percent (70%) for exceptional rate increase amounts; and
20.4 For each rate increase that is implemented, the insurer shall file for review by the commissioner updated projections, as defined in subsection 20.2.3.1 of this regulation, annually for the next three (3) years and include a comparison of actual results to projected values. The commissioner may extend the period to greater than three (3) years if actual results are not consistent with projected values from prior projections. For group insurance policies that meet the conditions in subsection 20.11 of this regulation, the projections required by subsection 20.4 of this regulation shall be provided to the policyholder in lieu of filing with the commissioner.
20.5 If any premium rate in the revised premium rate schedule is greater than 200 percent of the comparable rate in the initial premium schedule, lifetime projections, as defined in subsection 20.2.3.1 of this regulation, shall be filed for review [approval] by the commissioner every five (5) years following the end of the required period in subsection 20.4 of this regulation. For group insurance policies that meet the conditions in subsection 20.11 of this regulation, the projections required by subsection 20.5 of this regulation shall be provided to the policyholder in lieu of filing with the commissioner.
20.6 Actual v. projected experience.
20.6.1 If the commissioner has determined that the actual experience following a rate increase does not adequately match the projected experience and that the current projections under moderately adverse conditions demonstrate that incurred claims will not exceed proportions of premiums specified in subsection 20.3 of this regulation, the commissioner may require the insurer to implement any of the following:
20.6.1.1 Premium rate schedule adjustments; or
20.6.1.2 Other measures to reduce the difference between the projected and actual experience.
20.6.2 In determining whether the actual experience adequately matches the projected experience, consideration should be given to subsection 20.2.3.5 of this regulation, if applicable.
20.7.2 The original anticipated lifetime loss ratio, and the premium rate schedule increase that would have been calculated according to subsection 20.3 of this regulation had the greater of the original anticipated lifetime loss ratio or fifty-eight percent (58%) been used in the calculations described in subsections 20.3.2.1 and 20.3.2.3 of this regulation.
20.8.1.2 The rate increase is not an exceptional increase; and
20.8.2.1.1 Be subject to the approval of the Commissioner;
20.8.2.1.2 Be based on actuarially sound principles, but not be based on attained age; and
20.8.2.2.1 The maximum rate increase determined based on the combined experience; and
20.9 If the Commissioner determines that the insurer has exhibited a persistent practice of filing inadequate initial premium rates for long-term care insurance, the Commissioner may, in addition to the provisions of subsection 20.8 of this regulation, prohibit the insurer from either of the following:
20.9.1 Filing and marketing comparable coverage for a period of up to five (5) years; or
20.10 Subsections 20.1 through 20.9 of this regulation shall not apply to policies for which the long-term care benefits provided by the policy are incidental, as defined in subsection 4.2 of this regulation, if the policy complies with all of the following provisions:
20.10.2.1 18 Del.C. §2929; and
20.10.2.2 18 DE Admin. Code 1201;
20.10.3 The policy meets the disclosure requirements of 18 Del.C. §§ 7105 and 7106;
20.10.4.1 Policy illustrations as required by 18 DE Admin. Code 1210; and
20.10.4.2 Disclosure requirements in 18 DE Admin. Code 1201.
20.10.5 An actuarial memorandum is filed with the insurance department that includes:
20.10.5.1 A description of the basis on which the long-term care rates were determined;
20.10.5.2 A description of the basis for the reserves;
20.10.5.6 The estimated average annual premium per policy and the average issue age;
20.11 Subsections 20.6 and 20.8 of this regulation shall not apply to group insurance policies as defined in 18 Del.C. § 7103(4) where:
21.0 Filing Requirement
Prior to an insurer or similar organization offering group long-term care insurance to a resident of this state pursuant to 18 Del.C. §7104 it shall file with the Commissioner evidence that the group policy or certificate thereunder has been approved by a state having statutory or regulatory long-term care insurance requirements substantially similar to those adopted in this state.
22.0 Standard Format Outline of Coverage
22.1 Section 22.0 of this regulation implements, interprets and makes specific, the provisions of 18 Del.C. §7105, in prescribing a standard format and the content of an outline of coverage.
22.2 The outline of coverage shall be a free-standing document, using no smaller than ten point type.
22.3 The outline of coverage shall contain no material of an advertising nature.
22.4 Text which is capitalized or underscored in the standard format outline of coverage may be emphasized by other means which provide prominence equivalent to such capitalization or underscoring.
22.5 Use of the text and sequence of text of the standard format outline of coverage is mandatory, unless otherwise specifically indicated.
22.6 Format for outline of coverage:
[Policy Number or Group Master Policy and Certificate Number]
4. Terms Under Which the Policy OR Certificate May Be Continued in Force or Discontinued.
(c) [Describe waiver of premium provisions or state that there are not such provisions.]
5. TERMS UNDER WHICH THE COMPANY MAY CHANGE PREMIUMS.
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.]
9. BENEFITS PROVIDED BY THIS POLICY.
(b) [Institutional benefits, by skill level.]
(c) [Non-institutional benefits, by skill level.]
(d) Eligibility for Payment of Benefits
10. LIMITATIONS AND EXCLUSIONS.
(b) Non-eligible facilities and provider;
(d) Exclusions and exceptions;
THIS POLICY MAY NOT COVER ALL THE EXPENSES ASSOCIATED WITH YOUR LONG-TERM CARE NEEDS.
(a) That the benefit level will not increase over time;
(b) Any automatic benefit adjustment provisions;
[(a) State the total annual premium for the policy;
[(a) Indicate if medical underwriting is used;
(b) Describe other important features.]
23.0 Filing Requirements for Advertising
24.0 Standards for Marketing
24.1 Every insurer, health care service plan or other entity marketing long-term care insurance coverage in this state, directly or through its producers, shall:
24.1.1 Establish marketing procedures to assure that any comparison of policies by its agents or other producers will be fair and accurate.
24.1.2 Establish marketing procedures to assure excessive insurance is not sold or issued.
24.1.3 Display prominently by type, stamp or other appropriate means, on the first page of the outline of coverage and policy, the following: "Notice to Buyer: This policy may not cover all of the costs associated with long-term care incurred by the buyer during the period of coverage. The buyer is advised to review carefully all policy limitations."
24.1.4 Inquire and otherwise make every reasonable effort to identify whether a prospective applicant or enrollee for long-term care insurance already has accident and sickness or long-term care insurance and the types and amounts of any such insurance.
24.1.5 Every insurer or entity marketing long-term care insurance shall establish auditable procedures for verifying compliance with Section 24.0 of this regulation.
24.1.6 If the state of Delaware is the state in which the policy or certificate is delivered or issued for delivery, the insurer shall, at solicitation, provide written notice to the prospective policyholder or certificate holder that the Delaware Medicare Assistance Bureau (DMAB), formerly known as the Elderinfo Program, a senior counseling program approved by the Commissioner, is available and the name, address and telephone number of the DMAB.
24.2 In addition to the practices prohibited in 18 Del.C. Ch. 23, Unfair Trade Practices, the following acts and practices are prohibited:
24.2.1 Twisting. Knowingly making any misleading representation or incomplete or fraudulent comparison of any insurance policies or insurers for the purpose of inducing, or tending to induce, any person to lapse, forfeit, surrender, terminate, retain, pledge, assign, borrow on or convert any insurance policy or to take out a policy of insurance with another insurer.
24.2.2 High Pressure Tactics. Employing any method of marketing having the effect of or tending to induce the purchase of insurance through force, fright, threat, whether explicit or implied, or undue pressure to purchase or recommend the purchase of insurance.
24.2.3 Cold lead advertising. Making use directly or indirectly of any method of marketing which fails to disclose in a conspicuous manner that a purpose of the method of marketing is solicitation of insurance and that contact will be made by an insurance agent or insurance company.
25.0 Suitability
25.1 Section 25.0 of this regulation shall not apply to life insurance policies that accelerate benefits for long-term care.
25.2 Every insurer, health care service plan or other entity marketing long-term care insurance (“insurer”) shall:
25.2.1 Develop and use suitability standards to determine whether the purchase or replacement of long-term care insurance is appropriate for the needs of the applicant;
25.2.2 Train its agents in the use of its suitability standards; and
25.2.3 Maintain a copy of its suitability standards and make them available for inspection upon request by the Commissioner.
25.3 Procedures required.
25.3.1 To determine whether the applicant meets the standards developed by the insurer, the agent and insurer shall develop procedures that take the following into consideration:
25.3.1.1 The ability to pay for the proposed coverage and other pertinent financial information related to the purchase of the coverage;
25.3.1.2 The applicant’s goals or needs with respect to long-term care and the advantages and disadvantages of insurance to meet these goals or needs; and
25.3.1.3 The values, benefits and costs of the applicant’s existing insurance, if any, when compared to the values, benefits and costs of the recommended purchase or replacement.
25.3.2 The insurer, and where a producer is involved, the producer shall make reasonable efforts to obtain the information set out in subsection 25.3.1 of this regulation. The efforts shall include presentation to the applicant, at or prior to application, the “Long-Term Care Insurance Personal Worksheet.” The personal worksheet used by the issuer shall contain, at a minimum, the information in the format contained in Appendix B, in not less than twelve (12) point type. The insurer may request the applicant to provide additional information to comply with its suitability standards. A copy of the insurer’s personal worksheet shall be filed with the Commissioner.
25.3.3 A completed personal worksheet shall be returned to the insurer prior to the insurer’s consideration of the applicant for coverage, except the personal worksheet need not be returned for sales of employer group long-term care insurance to employees and their spouses.
25.3.4 The sale or dissemination outside the company or agency by the issuer or producer of information obtained through the personal worksheet in Appendix B is prohibited.
25.4 The insurer shall use the suitability standards it has developed pursuant to Section 25.0 of this regulation in determining whether issuing long-term care insurance coverage to an applicant is appropriate.
25.5 Producers shall use the suitability standards developed by the insurer in marketing long-term care insurance.
25.6 At the same time as the personal worksheet is provided to the applicant, the disclosure form entitled “Things You Should Know Before You Buy Long-Term Care Insurance” shall be provided. The form shall be in the format contained in Appendix C, in not less than twelve (12) point type.
25.7 If the issuer determines that the applicant does not meet its financial suitability standards, or if the applicant has declined to provide the information, the issuer may reject the application. In the alternative, the issuer shall send the applicant a letter similar to Appendix D. However, if the applicant has declined to provide financial information, the issuer may use some other method to verify the applicant’s intent. Either the applicant’s returned letter or a record of the alternative method of verification shall be made part of the applicant’s file.
25.8 The insurer shall report annually to the Commissioner the total number of applications received from residents of this state, the number of those who declined to provide information on the personal worksheet, the number of applicants who did not meet the suitability standards, and the number of those who chose to confirm after receiving a suitability letter.
26.0 Standards for Benefit Triggers
26.1 A long-term care insurance policy shall condition the payment of benefits on a determination of the insured’s ability to perform activities of daily living and on cognitive impairment. Eligibility for the payment of benefits shall not be more restrictive than requiring either a deficiency in the ability to perform not more than three (3) of the activities of daily living or the presence of cognitive impairment.
26.2 Activities of Daily Living
26.2.1 Activities of daily living shall include at least the following as defined in Section 5.0 of this regulation and in the policy:
26.2.1.1 Bathing;
26.2.1.2 Continence;
26.2.1.3 Dressing;
26.2.1.4 Eating;
26.2.1.5 Toileting; and
26.2.1.6 Transferring;
26.2.2 Insurers may use activities of daily living to trigger covered benefits in addition to those contained in subsection 26.2.1 of this regulation as long as they are defined in the policy.
26.3 An insurer may use additional provisions for the determination of when benefits are payable under a policy or certificate; however, the provisions shall not restrict, and are not in lieu of, the requirements contained in subsections 26.1 and 26.2 of this regulation.
26.4 For purposes of Section 26.0 of this regulation, the determination of a deficiency shall not be more restrictive than:
26.4.1 Requiring the hands-on assistance of another person to perform the prescribed activities of daily living; or
26.4.2 If the deficiency is due to the presence of a cognitive impairment, supervision or verbal cueing by another person is needed in order to protect the insured or others.
26.5 Assessments of activities of daily living and cognitive impairment shall be performed by licensed or certified professionals, such as physicians, nurses or social workers.
26.6 Long term care insurance policies shall include a clear description of the process for appealing and resolving benefit determinations.
26.7 The requirements set forth in Section 26.0 of this regulation shall be effective (12 months after adoption of this provision) and shall apply as follows:
26.7.1 Except as provided in subsection 26.7.2 of this regulation, the provisions of Section 26.0 of this regulation apply to a long-term care policy issued in this state on or after the effective date of the amended regulation.
26.7.2 For certificates issued on or after the effective date of this section, under a group long-term care insurance policy as defined in 18 Del.C. §7103(4)a, the provisions of Section 26.0 of this regulation shall not apply.
27.0 Prohibition Against Pre-Existing Conditions and Probationary Periods in Replacement Policies or Certificates
28.0 Requirement to Deliver Shopper's Guide
28.1 A long-term care insurance shopper's guide in the format developed by the National Association of Insurance Commissioners, or one developed or approved by the Commissioner, shall be provided to all prospective applicants of a long-term care insurance policy or certificate.
28.1.1 In the case of agent solicitations, an agent must deliver the shopper's guide prior to the presentation of an application or enrollment form.
28.1.2 In the case of direct response solicitations, the shopper's guide must be presented in conjunction with any application or enrollment form.
28.2 Life insurance policies or riders containing accelerated long-term care benefits are not required to furnish the guide referenced in subsection 28.1 of this regulation but shall furnish the policy summary required under 18 Del.C. §7105 (j).
29.0 Requirement to Offer Nonforfeiture Benefit
29.1 No policy or certificate may be delivered or issued for delivery in this state unless the insurer also offers to the policyholder or certificateholder the option to purchase a policy that provides for nonforfeiture benefits to the defaulting or lapsing policyholder or certificateholder.
29.1.1 For purpose of Section 29.0 of this regulation, attained age rating is defined as a schedule of premiums starting from the issue date which increases with increasing age at least one percent per year to age fifty (50), and at least three percent (3%) per year beyond age fifty (50).
29.1.2 For purposes of Section 29.0 of this regulation, the nonforfeiture benefit shall be a shortened benefit period providing paid-up long-term care insurance coverage after lapse.The same benefits (amounts and frequency in effect at the time of lapse but not increased thereafter) will be payable for a qualifying claim, but the lifetime maximum dollars or days of benefit shall be determined as specified in subsection 29.1.3 of this regulation.
29.1.3 The standard nonforfeiture credit will be equal to 100 percent of the sum of all premiums paid, including the premiums paid prior to any changes in benefits. The insurer may offer additional shortened benefit period options, as long as the benefits for each duration equal or exceed the standard nonforfeiture credit for that duration. However, the minimum nonforfeiture credit shall not be less than thirty (30) times the daily nursing home benefit at the time of lapse. In either event, the calculation of the nonforfeiture credit is subject to the limitation of subsection 29.2 of this regulation.
29.1.4 Effective Dates
29.1.4.2 Subsection 29.1.4.1 of this regulation notwithstanding, no policy or certificate shall begin a nonforfeiture benefit later than the end of the third year following the policy or certificate issue date except that for a policy or certificate with attained age rating, the nonforfeiture benefit shall begin on the earlier of:
29.1.4.2.1 The end of the tenth year following the policy or certificate issue date; or
29.1.4.2.2 The end of the second year following the date the policy or certificate is no longer subject to attained age rating.
29.1.5 Nonforfeiture credits may be used for all care and services qualifying for benefits under the terms of the policy or certificate, up to the limits specified in the policy or certificate.
29.2 All benefits paid by the insurer while the policy or certificate is in premium paying status and in the paid up status will not exceed the maximum benefits which would have been payable if the policy or certificate had remained in premium paying status.
29.3 There shall be no difference in the minimum nonforfeiture benefit as required under Section 29.0 of this regulation for group and individual policies.
29.4 The requirements set forth in Section 29.0 of this regulation shall become effective on May 1, 1997, except for certificates issued on or after the effective date of Section 29.0 of this regulation under a group long-term care insurance policy as defined in 18 Del.C. §7103, which policy was in force at the time this amended regulation became effective.
29.5 Premiums charged for a policy or certificate containing nonforfeiture benefits shall be subject to the loss ratio requirements of Section 18.0 of this regulation treating the policy as a whole.
29.6 Rejection of nonforfeiture benefit.
29.6.1 A nonforfeiture benefit as provided in subsections 29.1.2 and 29.1.3 of this regulation shall be included in a long-term care insurance policy or certificate unless an insurer obtains a rejection of a nonforfeiture benefit signed by the policyholder or certificateholder as required in Section 29.0 of this regulation.
29.6.2 The rejection shall be considered part of the application and shall state: I have reviewed the outline of coverage and the nonforfeiture benefit as described therein. Specifically, I have reviewed Plan ___________ and I reject the nonforfeiture benefit.
29.7 Nonforfeiture benefits for qualified long-term care policies shall meet the following requirements:
29.7.1 The nonforfeiture provision shall be appropriately captioned:
29.7.2 The nonforfeiture provision shall provide a benefit available in the event of a default in the payment of any premiums and shall state that the amount of the benefit may be adjusted subsequent to being initially granted only as necessary to reflect changes in claims, persistency and interest as reflected in changes in rates for premium paying contracts approved by the Commissioner for the same contract form; and
29.7.3 The nonforfeiture provision shall provide at least one of the following:
29.7.3.1 Reduced paid-up insurance;
29.7.3.2 Extended term insurance;
29.7.3.3 Shortened benefit insurance; or
29.7.3.4 Other similar offerings approved by the Commissioner.
29.8 If the required offer of a nonforfeiture benefit is rejected, the insurer shall provide the contingent benefit upon lapse described below. In the event that a group policyholder elects to make the nonforfeiture benefit an option to the certificateholder, a certificate shall provide either the nonforfeiture benefit or the contingent benefit upon lapse.
29.8.1 The contingent benefit on lapse shall be triggered every time an insurer increases the premium rates to a level which results in a cumulative increase of the annual premium set forth below based on the insured’s issue age, and the policy or certificate lapses within 120 days of the due date of the premium so increased. Unless otherwise required, policyholders shall be notified at least thirty (30) days prior to the due date of the premium reflecting the rate increase.
29.8.2 On or before the effective date of a substantial premium increase as defined in subsection 29.8.1 of this regulation, the insurer shall:
29.8.2.1 Offer to reduce policy benefits provided by the current coverage without the requirement of additional underwriting so that required premium payments are not increased;
29.8.2.2 Offer to convert the coverage to a paid-up status with a shortened benefit period in accordance with the terms of subsection 29.5 of this regulation. This option may be elected at any time during the 120-day period referenced in subsection 29.8.1 of this regulation; and
29.8.2.3 Notify the policyholder or certificate holder that a default or lapse at any time during the 120-day period referenced in subsection 29.8.1 of this regulation shall be deemed to be the election of the offer to convert in subsection 29.8.2.2 of this regulation.
29.8.2.4 The contingent benefit upon lapse shall begin not later than the end of the third year following the policy or certificate issue date.
30.0 Permitted Compensation Arrangements
30.1 An insurer or other entity may provide commission or other compensation to an agent or other representative for the sale of a long-term care insurance policy or certificate which shall not exceed thirty-five percent (35%) of the total premium paid for that policy year.
30.2 No entity shall provide compensation to its agents or other producers and no agent or producer shall receive compensation greater than twenty-five percent (25%) of the total premium paid for that policy year for the sale of a replacement long-term care insurance policy or certificate.
30.3 For purposes of Section 30.0 of this regulation, "compensation" includes pecuniary or non-pecuniary remuneration or any kind relating to the sale or renewal of the policy or certificate including but not limited to bonuses, gifts, prizes, awards and finders fees.
31.0 Penalties
32.0 Separability
33.0 Effective Date
This regulation became effective July 30, 1990, except Section 13.0 became effective July 1, 1993. Amendment #1 adopted nonforfeiture benefits (Section 26.0) on December 23, 1996, to become effective on May 1, 1997. Amendment #2 became effective on March 22, 1999 to become effective 120 days thereafter. Amendment #3 adding Sections 8.0, 10.0 and 20.0 shall become effective on January 1, 2005. Amendment #4 adding subsections 11.6 through 11.11 became effective on October 11, 2001. Amendment #5 adding new subsections 8.2.5.1.4 through 8.2.5.1.7 and new subsection 8.6 shall become effective 10 days after its adoption.
Company Name:___________________________________________
Address:______________________________________
Phone Number:__________________________________
Detailed reason for rescission: ________________________________________________
__________________________________
__________________________________
__________________________________
Policy Form Numbers____________________
Type of Policy (non cancellable/guaranteed renewable):________________________________
The Company’s Right to Increase Premiums:
Questions Related to Your Income
How will you pay each year’s premium?
®From my Income ®From my Savings/Investments ®My Family will Pay
What is your annual income? (check one)
®Under $10,000 ®$[10-20,000] ®$[20-30,000]
How do you expect your income to change over the next 10 years? (check one)
®No change ®Increase ®Decrease
Will you buy inflation protection?(check one) ®Yes ® No
®From my Income ®From my Savings/Investments ®My Family will Pay
How are you planning to pay for your care during the elimination period? (check one)
®From my Income ®From my Savings/Investments ®My Family will Pay
Question Related to Your Savings and Investments
®Under $20,000 ®$20,000-$30,000 ®$30,000-$50,000 ®Over $50,000
How do you expect your assets to change over the next ten years? (check one)
®Stay about the same ®Increase ®Decrease
|
®The information provided above accurately describes my financial situation. |
[® I explained to the applicant the importance of completing this information.
The company may contact you to verify your answers.
Things You Should Know Before You Buy Long-Term Care Insurance
Long-Term Care Insurance Suitability Letter
[You chose not to provide any financial information for us to review.]
Drafting Note: Choose the paragraph that applies.
Please check one box and return in the enclosed envelope.
® No. I have decided not to buy a policy at this time.
Please return to [issuer] at [address] by [date].
Insurers shall provide all of the following information to the applicant:
Potential Rate Increase Disclosure Form
Drafting Note: Use "approved" in states requiring prior approval of rates.
"Pay the increased premium and continue your policy in force as is.
You will keep some long-term care insurance coverage, if:
"You lapse (not pay more premiums) within 120 days of the increase.
Cumulative Premium Increase over Initial Premium
That qualifies for Contingent Nonforfeiture
