376.1100. Law, how cited--definitions.
Law, how cited--definitions.
376.1100. 1. Sections 376.1100 to 376.1130 may be known and cited asthe "Long-term Care Insurance Act".
2. As used in sections 376.1100 to 376.1130, unless the context requiresotherwise, the following terms mean:
(1) "Applicant":
(a) In the case of an individual long-term care insurance policy, theperson who seeks to contract for benefits; and
(b) In the case of a group long-term care insurance policy, the proposedcertificate holder;
(2) "Certificate", any certificate issued under a group long-term careinsurance policy, which policy has been delivered or issued for delivery inthis state;
(3) "Director", the director of the department of insurance, financialinstitutions and professional registration of this state;
(4) "Group long-term care insurance", a long-term care insurance policywhich is delivered or issued for delivery in this state and issued to:
(a) One or more employers or labor organizations, or to a trust or tothe trustees of a fund established by one or more employers or labororganizations, or a combination thereof, for employees or former employees ora combination thereof or for members or former members or a combinationthereof, of the labor organization; or
(b) Any professional, trade or occupational association for its membersor former or retired members, or combination thereof, if such association;
a. Is composed of individuals all of whom are or were actively engagedin the same profession, trade or occupation; and
b. Has been maintained in good faith for purposes other than obtaininginsurance; or
(c) An association or a trust or the trustee of a fund established,created or maintained for the benefit of members of one or more associations.Prior to advertising, marketing or offering such policy within this state, theassociation or associations, or the insurer of the association orassociations, shall file evidence with the director that the association orassociations have at the outset a minimum of one hundred persons and have beenorganized and maintained in good faith for purposes other than that ofobtaining insurance; have been in active existence for at least one year; andhave a constitution and bylaws which provide that:
a. The association or associations hold regular meetings not less thanannually to further purposes of the members;
b. Except for credit unions, the association or associations collectdues or solicit contributions from members; and
c. The members have voting privileges and representation on thegoverning board and committees.
Thirty days after such filing the association or associations shall be deemedto satisfy such organizational requirements, unless the director makes afinding that the association or associations do not satisfy thoseorganizational requirements;
(d) A group other than as described in paragraph (a), (b) or (c) ofsubdivision (4) of this subsection, subject to a finding by the director that:
a. The issuance of the group policy is not contrary to the best interestof the public;
b. The issuance of the group policy would result in economies ofacquisition or administration; and
c. The benefits are reasonable in relation to the premiums charged;
(5) "Long-term care insurance", any insurance policy or rideradvertised, marketed, offered or designed to provide coverage for not lessthan twelve consecutive months for each covered person on an expense-incurred,indemnity, prepaid or other basis; for one or more necessary or medicallynecessary diagnostic, preventive, therapeutic, rehabilitative, maintenance ofpersonal care services, provided in a setting other than an acute care unit ofa hospital. Such term includes group and individual annuities and lifeinsurance policies or riders which provide directly or which supplementlong-term care insurance. Such term also includes a policy or rider whichprovides for payment of benefits based upon cognitive impairment or the lossof functional capacity. Long-term care insurance also includes qualifiedlong-term care insurance contracts. Long-term care insurance may be issued byinsurers; fraternal benefit societies; health services corporations; prepaidhealth plans; health maintenance organizations, or any similar organization tothe extent they are otherwise authorized to issue life or health insurance.Long-term care insurance shall not include any insurance policy which isoffered primarily to provide basic Medicare supplement coverage, basichospital expense coverage, basic medical-surgical expense coverage, hospitalconfinement indemnity coverage, major medical expense coverage, disabilityincome or related asset protection coverage, accident only coverage, specifieddisease or specified accident coverage, or limited benefit health coverage.With respect or regard to life insurance, long-term care insurance does notinclude life insurance policies that accelerate the death benefit specificallyfor one or more of the qualifying events of terminal illness, medicalconditions requiring extraordinary medical intervention, or permanentinstitutional confinement, and that provide the option of a lump sum paymentfor those benefits and neither the benefits nor the eligibility for thebenefits is conditioned upon the receipt of long-term care. Notwithstandingany other provision of sections 376.1100 to 376.1130 to the contrary, anyproduct advertised, marketed, or offered as long-term care insurance shall besubject to the provisions of sections 376.1100 to 376.1130;
(6) "Policy", any policy, subscriber agreement, rider or endorsementdelivered or issued for delivery in this state by an insurer; fraternalbenefit society; health services corporation; prepaid health plan, healthmaintenance organization, or any similar organization;
(7) "Qualified long-term care insurance contract" or "federallytax-qualified long-term care insurance contract", the portion of a lifeinsurance contract that provides long-term care insurance coverage by rider oras part of the contract that satisfies the requirements of Section 7702B(b)and (e) of the Internal Revenue Code of 1986, as amended. "Qualifiedlong-term care insurance contract" also includes an individual or groupinsurance contract that meets the requirements of Section 7702B(b) of theInternal Revenue Code of 1986, as amended, as follows:
(a) The only insurance protection provided under the contract iscoverage of qualified long-term care services. A contract shall not fail tosatisfy the requirements of this paragraph by reason of payments being made ona per diem or other periodic basis without regard to the expenses incurredduring the period to which the payments relate;
(b) The contract does not pay or reimburse expenses incurred forservices or items to the extent that the expenses are reimbursable under TitleXVIII of the Social Security Act, as amended, or would be so reimbursable butfor the application of a deductible or coinsurance amount. The requirementsof this paragraph do not apply to expenses that are reimbursable under TitleXVIII of the Social Security Act only as a secondary payor. A contract shallnot fail to satisfy the requirements of this paragraph by reason of paymentsbeing made on a per diem or other periodic basis without regard to theexpenses incurred during the period to which the payments relate;
(c) The contract is guaranteed renewable within the meaning of Section7702B(b)(1)(C) of the Internal Revenue Code of 1986, as amended;
(d) The contract does not provide for a cash surrender value or othermoney that can be paid, assigned, pledged as collateral for a loan, orborrowed except as provided in paragraph (e) of this subdivision;
(e) All refunds of premiums and all policyholder dividends or similaramounts under the contract are to be applied as a reduction in future premiumsor to increase future benefits; except that a refund on the event of death ofthe insured or a complete surrender or cancellation of the contract shall notexceed the aggregate premiums paid under the contract; and
(f) The contract meets the consumer protection provisions set forth inSection 7702B(g) of the Internal Revenue Code of 1986, as amended.
(L. 1990 S.B. 765 §§ 1, 2, A.L. 2002 H.B. 1568 merged with S.B. 1009)*Transferred 2002; formerly 376.951