HEARING - U.S. Senate Special Committee on Aging

169
Drafting Note State laws relating to nursing and other facilities and
agencies are not uniform. Anrdingly, specific reference to or incorporation
of the individual state law may be required in structuring each definition.
Comments This section is intended to specify required definitional elements
of seveal terms commonly found in long-term care insurance policies while
allowing some flexibility in the definitions themselves.,
Secwfm 61 Pnlicy P seiVs aAnd Prnvictnnc
A. Renewability- The terms "conditionally renewable". "guaranteed
renewable', and "noncancellable" ahall not be used in any individual
long-term care insurance policy, without further explanatory language in
accordance with the disclosure requirements of Section 7. No such policy
issued to an individual shall contain renewal provisions less favorable to
the insured than "conditionally renewable'.
1. The term "conditionally renewable" may be used only when the insured
has the right to continue the long-term care insurance in force by the
timely payment of premiums and the insurer has no unilateral right to
make any change in any provision of the policy or rider while the
insurance is in force, except that the insurer may revise rates on a
class basis and may decline to renew by class, by geographic area or
for stated reasons other than age or deterioration of health.
2. Mhe term "guaranteed renewable" may be used only when the insured has
the right to continue the long-term care insurance in force by the
timely payment of premiums and when the insurer has no unilateral
right to make any change in any provision of the policy or rider while
the insurance is in force, and cannot decline to renew, except that
rates may be revised by the insurer on a class basis.
72-699 o - 87 -- 7