Section 3 AAC 28.556 - Required disclosure of rating practices to consumers(a) This section applies as follows:(1) except as provided in (2) of this subsection, this section applies to a long-term care policy or certificate issued in this state on or after January 1, 2023;(2) for certificates issued on or after March 27, 2022 effective date of regulation under a group long-term care insurance policy as defined in AS 21.53.200(3)(A), which policy was in force on or after March 23, 2022, the provisions of this section apply on the policy anniversary following January 1, 2023.(b) Except for policies for which no applicable premium rate or rate schedule increases can be made, insurers shall provide all of the information listed in this subsection to the applicant at the time of application or enrollment, unless the method of application does not allow for delivery at that time. In that case, an insurer shall provide to the applicant, no later than at the time of delivery of the policy or certificate, all of the following information: (1) a statement that the policy may be subject to rate increases in the future;(2) an explanation of potential future premium rate revisions, and the policyholder's or certificate holder's options if a premium rate revision occurs;(3) the premium rate or rate schedules applicable to the applicant that will be in effect until a request is made for an increase;(4) a general explanation for applying premium rate or rate schedule adjustments that must include (A) a description of when premium rate or rate schedule adjustments will be effective, for example the next anniversary date or next billing date; and(B) the right to a revised premium rate or rate schedule as provided in (3) of this subsection if the premium rate or rate schedule is changed;(5) information regarding each premium rate increase on this policy form, or similar policy forms, over the past 10 years for this state or another state that:(A) at a minimum, identifies: (i) the policy forms for which premium rates have been increased;(ii) the calendar years when the form was available for purchase; and(iii) the amount or percent of each increases; the percentage may be expressed as a percentage of the premium rate before the increase, and may also be expressed as minimum and maximum percentages if the rate increase is variable by rating characteristics; and(B) may provide additional explanatory information related to the rate increases.(c) An insurer has the right to exclude from the disclosure, any premium rate increases that only apply to blocks of business acquired from other nonaffiliated insurers or the long-term care policies acquired from other nonaffiliated insurers when those increases occurred before the acquisition.(d) 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 March 27, 2022 the end of a 24-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 (b)(5)(A) of this section.(e) If the acquiring insurer in (d) of this section files for a subsequent rate increase, even within the 24-month period, on the same policy form acquired from nonaffiliated insurers or block of policy forms acquired from nonaffiliated insurers referenced in (d) of this section, the acquiring insurer shall make all disclosures required by (b)(5) of this section, including disclosure of the earlier rate increase referenced in (d) of this section.(f) An applicant shall sign an acknowledgement at the time of application that the insurer made the disclosure required under (b)(1) and (5) of this section, unless the method of application does not allow for signature at that time. If due to the method of application, the applicant cannot sign an acknowledgement at the time of application, the applicant shall sign not later than at the time of delivery of the policy or certificate.(g) An insurer shall use the forms prescribed by the director to comply with the requirements of (b) - (f) of this section.(h) An insurer shall provide notice of an upcoming premium rate schedule increase to all policyholders or certificate holders at least 45 days before the implementation of the premium rate schedule increase by the insurer. The notice shall include the information required by (b) - (e) of this section when the rate increase is implemented. Eff. 3/27/2022, Register 241, April 2022Authority:AS 21.06.090
AS 21.53.020
AS 21.53.030
AS 21.53.050
AS 21.53.090
AS 21.53.200