AB 2366, as amended, Dababneh. Long-term care insurance.
Existing law provides for the regulation of long-term care insurance, as defined, and requires the Insurance Commissioner to review and approve individual and group policies, certificates, riders, and outlines of coverage.begin insert Existing law requires every long-term care policy to contain a provision that, in the event the insurer develops new benefits or benefit eligibility or new policies with new benefits or benefit eligibility not included in the previously issued policy, the insurer shall grant specified current policyholders certain rights, namely notifying the policyholders of the new benefits or benefit eligibility or new policy within 12 months and offering the new benefits or benefit eligibility to those policyholders, as specified. The insurer is required to file the notice to current policyholders with the Department of Insurance at the same time as the new policy or rider.end insert
begin insertThis bill would exempt life insurance-based combination policies that include long-term care coverage provisions from the above-described requirements.
end insertThis bill would make technical, nonsubstantive changes to that provision.
end deleteVote: majority.
Appropriation: no.
Fiscal committee: begin deleteno end deletebegin insertyesend insert.
State-mandated local program: no.
The people of the State of California do enact as follows:
begin insertSection 10235.52 of the end insertbegin insertInsurance Codeend insertbegin insert is
2amended to read:end insert
(a) begin deleteEvery end deletebegin insertEach end insertpolicy shall contain a provision that,
4begin delete in the eventend deletebegin insert ifend insert the insurer develops new benefits or benefit
5eligibility or new policies with new benefits or benefit eligibility
6not included in the previously issued policy, the insurerbegin delete willend deletebegin insert
shallend insert
7 grant current holders of its policies who are not in benefit or within
8the elimination periodbegin insert all ofend insert the following rights:
9(1) Thebegin delete policyholder will be notifiedend deletebegin insert
insurer shall notify the
10policyholderend insert
of the availability of the new benefits or benefit
11eligibility or new policy within 12 months. Thebegin delete insurer’s notice begin insert insurer shall file the noticeend insert with the department at
12shall be filedend delete
13the same time as the new policy or rider.
14(2) The insurer shall offer the policyholder new benefits or
15benefit eligibility in one of the following ways:
16(A) By adding a rider to the existing policy and paying a separate
17premium for the new benefits or benefit eligibility based on the
18insured’s attained age. The premium for the existing policybegin delete willend delete
19begin insert
shallend insert remain unchanged based on the insured’s age at issuance.
20(B) By replacing the existing policy or certificate in accordance
21with Section 10234.87.
22(C) By replacing the existing policy or certificate with a new
23policy or certificate in which case consideration for past insured
24status shall be recognized by setting the premium for the
25replacement policy or certificate at the issue age of the policy or
26certificate being replaced.
27(b) The insured may be required to undergo new underwriting,
28but the underwriting can be no more restrictive than if the
29policyholder or certificate holder were applying for a new policy
30or certificate.
31(c) The insurer of a group policy as defined under subdivisions
32(a) to (c),
inclusive, of Section 10231.6begin delete mustend deletebegin insert shallend insert offer the group
33policyholder the opportunity to have the new benefits and
34provisions extended to existing certificate holders, but the insurer
P3 1is relieved of the obligations imposed by this section if the holder
2of the group policy declines the issuer’s offer.
3(d) This section shall become operative on June 30, 2003.
end delete
4(d) The provision described in subdivision (a) shall not be
5required for life insurance-based combination
policies that include
6long-term care coverage provisions.
Section 10231.2 of the Insurance Code is
8amended to read:
(a) “Long-term care insurance” includes any
10insurance policy, certificate, or rider advertised, marketed, offered,
11solicited, or designed to provide coverage for diagnostic,
12preventive, therapeutic, rehabilitative, maintenance, or personal
13care services that are provided in a setting other than an acute care
14unit of a hospital. Long-term care insurance includes all products
15containing any of the following benefit types: coverage for
16institutional care including care in a nursing home, convalescent
17facility, extended care facility, custodial care facility, skilled
18nursing
facility, or personal care home; home care coverage
19including home health care, personal care, homemaker services,
20hospice, or respite care; or community-based coverage including
21adult day care, hospice, or respite care. Long-term care insurance
22includes disability based long-term care policies but does not
23include insurance designed primarily to provide Medicare
24supplement or major medical expense coverage.
25(b) Long-term care policies, certificates, and riders shall be
26regulated
under this chapter. The commissioner shall review and
27approve individual and group policies, certificates, riders, and
28outlines of coverage. Other applicable laws and regulations shall
29also apply to long-term care insurance insofar as they do not
30conflict with the provisions in this chapter. Long-term care benefits
31designed to provide coverage of one year or more that are contained
32in or amended to Medicare supplement or other disability policies
33and certificates shall be regulated under this chapter.
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