§431:10H-220  Requirement to offer inflation

protection; group and individual policies.  (a)  No insurer may offer a

long-term care insurance policy unless the insurer also offers to the

policyholder in addition to any other inflation protection 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 care services covered by the

policy.  Insurers shall 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:

     (1)  Increases benefit levels annually in a manner so

that the increases are compounded annually at a rate not less than five per

cent;

     (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 the 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 per cent for the period beginning with the

purchase of the existing benefit and extending until the year in which the

offer is made; or

     (3)  Covers a specified percentage of actual or

reasonable charges and does not include a maximum specified indemnity amount or

limit.

     (b)  Where the policy is issued to a group, the

required offer in subsection (a) shall be made to the group policyholder;

except if the policy is issued to a group defined in paragraph (4) under the

definition of "group long-term care insurance" in section 431:10H-104

other than to a continuing care retirement community, the offering shall be

made to each certificate holder.

     (c)  The offer in subsection (a) shall not be

required of life insurance policies or riders containing accelerated long-term

care benefits.

     (d)  Insurers shall include the following information

in or with the outline of coverage:

     (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-year period.

     (2)  Any expected premium increases or additional

premiums to pay for automatic or optional benefit increases.

     (e)  Inflation protection benefit increases

under a policy which contains these 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.

     (f)  An offer of inflation protection that

provides for automatic benefit increases shall include an offer of a premium

which the insurer expects to remain constant.  The offer shall disclose in a

conspicuous manner that the premium may change in the future unless the premium

is guaranteed to remain constant.

     (g)  Inflation protection in subsection (a)(2)

shall be included in a long-term care insurance policy unless the insurer

obtains a rejection of inflation protection signed by the policyholder as

required in subsection (h).

     (h)  The rejection shall be considered a part

of the application and shall state:

 

     "I have reviewed

the outline of coverage and the graphs that compare the benefits and premiums

of this policy with and without inflation protection.  Specifically, I have

reviewed Plans _________________, and I REJECT INFLATION PROTECTION."

 

[L 1999, c 93, pt of §2; am L 2003, c 212, §96]