Section R590-148-17 - Suitability(1) An insurer shall: (a) develop and use suitability standards to determine whether the purchase or replacement of long-term care insurance is appropriate for the needs of the applicant;(b) train its producers in its suitability standards; and(c) maintain a copy of its suitability standards.(2)(a) To determine whether an applicant meets the insurer's standards, the producer and insurer shall develop a procedure that considers: (i) the applicant's ability to pay for the proposed coverage and other pertinent financial information related to the purchase of the coverage;(ii) the applicant's goals or needs regarding long-term care and the advantages and disadvantages of insurance to meet those goals or needs; and(iii) the values, benefits, and costs of the applicant's existing insurance, if any, when compared to the values, benefits, and costs of the recommended purchase or replacement.(b)(i) The insurer and producer shall:(A) make a reasonable effort to obtain the information in Subsection (2)(a); and(B) present to the applicant, at or before application, the Long-Term Care Insurance Personal Worksheet, in at least 12-point font.(ii) The insurer may request that the applicant provide additional information to comply with the insurer's suitability standards.(c)(i) A completed Long-Term Care Insurance Personal Worksheet shall be returned to the insurer before the insurer considers theapplicant for coverage.(ii) The Long-Term Care Insurance Personal Worksheet is not required for a sale to an employee and their spouse under an employer group policy.(d) The sale or dissemination, outside the company or agency by the insurer or producer, of information obtained through the Long-Term Care Insurance Personal Worksheet is prohibited.(3) An insurer shall use its suitability standards to determine whether issuing long-term care insurance coverage to an applicant is appropriate.(4) A producer shall use the insurer's suitability standards.(5) When the Long-Term Care Insurance Personal Worksheet is provided to the applicant, the Things You Should Know Before You Buy Long-Term Care Insurance disclosure shall be provided in at least 12-point font.(6)(a) If an insurer determines that the applicant does not meet its suitability standards, or if the applicant declines to provide the requested information, the insurer may reject the application.(b)(i) The insurer shall send the applicant a letter similar to the Long-Term Care Insurance Suitability Letter.(ii) If the applicant declines to provide financial information, the insurer may use another method to verify the applicant's intent.(c) Either the applicant's returned letter or a record of the alternative method of verification shall be made part of the applicant's file.(7) If replacing a policy or certificate, the replacing insurer shall waive all time periods applicable to a preexisting condition and probationary period in the new policy or certificate for a similar benefit, to the extent the exclusions were satisfied under the original policy.Utah Admin. Code R590-148-17
Adopted by Utah State Bulletin Number 2024-21, effective 10/22/2024