TITLE 27

Insurance

CHAPTER 27-34.2

Long Term Care Insurance

SECTION 27-34.2-12



   § 27-34.2-12  Unintentional policy lapse.

–

(a) Each insurer offering long term care insurance shall, as a protection

against unintentional lapse comply with the following:



   (1)(i) No individual long term care policy or certificate

shall be issued until the insurer has received from the applicant either: a

written designation of at least one person, in addition to the applicant, who

is to receive notice of lapse or termination of the policy or certificate for

nonpayment of premium, or a written waiver dated and signed by the applicant

electing not to designate additional persons to receive notice. The applicant

has the right to designate at least one person who is to receive the notice of

termination, in addition to the insured. Designation shall not constitute

acceptance of any liability on the third party for services provided to the

insured. The form used for the written designation must provide space clearly

designated for listing at least one person. The designation shall include each

person's full name and home address. In the case of an applicant who elects not

to designate an additional person, the waiver shall state: "Protection against

unintended lapse. I understand that I have the right to designate at least one

person other than myself to receive notice of lapse or termination of this long

term care insurance policy for nonpayment of premium. I understand that notice

will not be given until thirty (30) days after premium is due and unpaid. I

elect NOT to designate any person to receive such notice."



   (ii) The insurer shall notify the insured of the right to

change this written designation, no less than once every two (2) years;



   (2) When the policyholder or certificate holder pays a

premium for a long term care insurance policy or certificate through a payroll

or pension deduction plan, the requirements continued in subsection (1)(i) need

not be met until sixty (60) days after the policyholder or certificate holder

is no longer on the payment plan. The application or enrollment form for those

policies or certificates shall clearly indicate the payment plan selected by

the applicant;



   (3) 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

subdivision (1) of this section 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.



   (b) Reinstatement. In addition to the requirement in

subsection (a), 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.



History of Section.

(P.L. 1993, ch. 443, § 2; P.L. 1993, ch. 457, § 2; G.L. 1956, §

27-34.2-13; P.L. 2007, ch. 239, § 1.)