18 Del. Admin. Code § 1404-8.0

Current through Register Vol. 28, No. 5, November 1, 2024

Section 1404-8.0 - Required Disclosure of Rating Practices to Consumers and Agent of Record

8.1 Subsection 8.1 shall apply as follows:

8.1.1 Except as provided in subsection 8.1.2 of this regulation, Section 8.0 of this regulation applies to any long-term care policy or certificate issued in this state on or after March 1, 2005.

8.1.2 For certificates issued on or after the effective date of this amended regulation under a group long-term care insurance policy as defined in 18 Del.C. § 7103(4) a, which policy was in force at the time this amended regulation became effective, the provisions of Section 8.0 of this regulation shall apply on the policy anniversary following January 1, 2006.

8.2 Other than policies for which no applicable premium rate or rate schedule increases can be made, insurers shall provide all of the information listed in subsection 8.2 of this regulation to the applicant at the time of application or enrollment, unless the method of application does not allow for delivery at that time. In such a case, an insurer shall provide all of the information listed in Section 8.0 of this regulation to the applicant no later than at the time of delivery of the policy or certificate.

8.2.1 A statement that the policy may be subject to rate increases in the future;

8.2.2 An explanation of potential future premium rate revisions, and the policyholder's or certificate holder's option in the event of a premium rate revision;

8.2.3 The premium rate or rate schedules applicable to the applicant that will be in effect until a request is made for an increase;

8.2.4 A general explanation for applying premium rate or rate schedule adjustments that shall include:

8.2.4.1 A description of when premium rate or rate schedule adjustments will be effective (e.g., next anniversary date, next billing date, etc.); and

8.2.4.2 The right to a revised premium rate or rate schedule as provided in subsection 8.2.3 of this regulation if the premium rate or rate schedule is changed;

8.2.5 Premium rate increase information

8.2.5.1 Information regarding each premium rate increase on this policy form or similar policy forms over the past 10 years for this state or any other state that, at a minimum, identifies:

8.2.5.1.1 The policy forms for which premium rates have been increased;

8.2.5.1.2 The calendar years when the form was available for purchase; and

8.2.5.1.3 The amount or percent of each increase. The percentage may be expressed as a percentage of the premium rate prior to the increase, and may also be expressed as minimum and maximum percentages if the rate increase is variable by rating characteristics.

8.2.5.2 The insurer may, in a fair manner, provide additional explanatory information related to the rate increases.

8.2.5.3 An insurer shall have the right to exclude from the disclosure 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 prior to the acquisition.

8.2.5.4 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 the effective date of Section 8.0 of this regulation or the end of a twenty-four-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 subsection 8.2.5.1 of this regulation.

8.2.5.5 If the acquiring insurer in subsection 8.2.5.4 of this regulation files for a subsequent rate increase, even within the twenty-four-month period, on the same policy form acquired from nonaffiliated insurers or block of policy forms acquired from nonaffiliated insurers referenced in subsection 8.2.5.4 of this regulation, the acquiring insurer shall make all disclosures required by subsections 8.2.5 and 8.5 of this regulation, including disclosure of the earlier rate increase referenced in subsection 8.2.5.4 of this regulation.

8.3 An applicant shall sign an acknowledgement at the time of application, unless the method of application does not allow for signature at that time, that the insurer made the disclosure required under subsections 8.2.1 and 8.2.5 of this regulation. If due to the method of application the applicant cannot sign an acknowledgement at the time of application, the applicant shall sign no later than at the time of delivery of the policy or certificate.

8.4 An insurer shall use the forms in Appendices B and F to comply with the requirements of subsections 8.2 and 8.3 of this regulation.

8.5 An insurer shall provide notice of an upcoming premium rate schedule increase to all policyholders or certificate holders, if applicable, at least 45 days prior to the implementation of the premium rate schedule increase by the insurer. The notice shall include the information required by subsection 8.2 of this regulation when the rate increase is implemented, along with the following additional information:

8.5.1 The current daily, monthly, or other periodic benefit amount under the policy or certificate, along with customer service contact information where the policyholder or certificate holder can obtain additional information regarding these benefits;

8.5.2 A reasonable list consisting of no less than three available reduced benefit options, and the impact on the current premium for each listed reduced benefit option, along with customer contact information where the policyholder or certificate holder can obtain additional information regarding these benefit options. Upon the request of a policyholder or certificate holder, an insurer shall provide a comprehensive list of available reduced daily benefits options and the impact on the current premium for each listed reduced benefit option or a statement similar in substance to the following: "You have the right to reduce your periodic benefit amount to [any amount down to $XX/period in $YY increments"]; and

8.5.3 A description of the contingent non-forfeiture benefit available on lapse, along with customer service contact information where the policyholder or certificate holder can obtain additional information regarding this benefit.

8.6 Either prior to or concurrently as notice is being sent to the policyholder or certificate holder, the insurer shall notify the agent of record of any policy changes and premium rate increases, either by providing the agent with a copy of the notice packet being sent to the policyholder or providing the same information in a condensed format.

18 Del. Admin. Code § 1404-8.0

2 DE Reg. 2113 (05/01/99)
25 DE Reg. 714 (1/1/2022)
26 DE Reg. 767 (3/1/2023) (Final)