N.J. Admin. Code § 11:4-34.9

Current through Register Vol. 56, No. 23, December 2, 2024

Section 11:4-34.9 - Prohibition against post-claims underwriting

(a) Carriers must complete underwriting prior to issuing a policy or certificate and are prohibited from reunderwriting at the time of claim.

(b) All applications for long-term care insurance policies or certificates except those that are guaranteed issue, that is, that are issued without medical or other underwriting, shall contain clear and unambiguous questions designed to ascertain the health condition of the applicant.

1. If an application for long-term care insurance contains a question that asks whether the applicant has had medication prescribed by a physician, it must also ask the applicant to list the medication that has been prescribed.

2. If the medications listed in the application were known by the carrier, or should have been known at the time of application, to be directly related to a medical condition for which coverage would have been but was not denied, then the policy or certificate shall not be rescinded for that condition.

(c) Except for policies or certificates which are guaranteed issue, that is, that are issued without medical or other underwriting:

1. The following language shall be set out in boldface and in close conjunction with the applicant's signature block on an application for a long-term care insurance policy or certificate: Caution: If your answers on this application are incorrect or untrue, [carrier] has the right to deny benefits or rescind your [policy] [certificate].

2. The following language, or language substantially similar to the following, shall be set out in boldface on the long-term care insurance policy or certificate at the time of delivery: Caution: The issuance of this long-term care insurance [policy] [certificate] is based upon your responses to the questions on your application. A copy of your [application] [enrollment form] [is enclosed] [was retained by you when you applied] [and has been attached to your] [policy] [certificate]. If your answers are incorrect or untrue, the carrier has the right to deny benefits or rescind your [policy][certificate]. The best time to clear up any questions is now, before a claim arises! If, for any reason, any of your answers are incorrect, contact the carrier at this address: [insert address]

3. Prior to issuance of a long-term care policy or certificate to an applicant age 80 or older, the carrier shall obtain one of the following:

i. A report of a physical examination;

ii. An assessment of functional capacity;

iii. An attending physician's statement; or

iv. Copies of medical records.

(d) A copy of the completed application or enrollment form (whichever is applicable) shall be delivered to the insured no later than at the time of delivery of the policy or certificate unless it was retained by the applicant at the time of application. Pursuant to 17B:24-3, no application for any long term care coverage issued on an individual basis shall be admissible in evidence in any action relative to such coverage, unless a copy of the application was attached to or endorsed upon the policy or certificate when issued.

(e) Every carrier selling or issuing long-term care insurance coverage shall maintain a record of all policy or certificate rescissions, both State and countrywide, except those that the insured voluntarily effectuated, and shall annually furnish this information to the Commissioner in the format prescribed by the National Association of Insurance Commissioners in subchapter Appendix A, incorporated herein by reference.

N.J. Admin. Code § 11:4-34.9