Prohibition Against Post Claims Underwriting

Section 2012 Section 2012.65  Prohibition Against Post Claims Underwriting a)         All applications for long-term care insurance policies or certificates except those which are guaranteed issue shall contain unambiguous questions designed to ascertain the health condition of the applicant. 1)         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. 2)         If the medications listed in the application were known by the insurer, or should be 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to a medical condition for which coverage would otherwise be denied, then the policy or certificate shall not be rescinded for that condition. b)         Except for policies or certificates that are guaranteed issue: 1)         The following language shall be set out conspicuously and in close conjunction with the applicant's signature block on an application for a traditional long-term care insurance policy or certificate: Caution:  If your answers on this application are incorrect or untrue, [company] may have the right to deny benefits or rescind your policy. 2)         The following language shall be set out 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 may have 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] 3)         Prior to issuance of a long-term care policy or certificate to an applicant age 80 or older, the insurer shall obtain one of the following: A)        A report of a physical examination; B)        An assessment of functional capacity; C)        An attending physician's statement; or D)        Copies of medical records. c)         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. d)         Every insurer, as defined in Section 2012.30 of this Part, selling or issuing long-term care insurance benefits shall maintain a record of all policy or certificate rescissions, both State and countrywide, except those the insured voluntarily effectuated and shall annually furnish this information to the Director of Insurance in the format prescribed in Exhibit D.