as introduced - 80th Legislature (1997 - 1998) Posted on 12/15/2009 12:00am
1.1 A bill for an act 1.2 relating to insurance; modifying and recodifying 1.3 certain required provisions of disability policies; 1.4 amending Minnesota Statutes 1996, section 62A.04, 1.5 subdivisions 2 and 3; proposing coding for new law in 1.6 Minnesota Statutes, chapter 62A. 1.7 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 1.8 Section 1. Minnesota Statutes 1996, section 62A.04, 1.9 subdivision 2, is amended to read: 1.10 Subd. 2. [REQUIRED PROVISIONS.] Except as provided in 1.11 subdivision 4, eachsuchpolicy of accident and sickness 1.12 insurance delivered or issued for delivery toanya person in 1.13 this state other than a policy that is limited to disability or 1.14 income protection coverage shall contain the provisions 1.15 specified in this subdivision in the words in which the same 1.16 appear in this section. The insurer may, at its option,1.17 substitute for one or more ofsuchthe provisions corresponding 1.18 provisions of different wording approved by the commissioner 1.19 which are in each instance not less favorable in any respect to 1.20 the insured or the beneficiary.SuchThe provisionsshallmust 1.21 be preceded individually by the caption appearing in this 1.22 subdivision or, at the option of the insurer, bysuch1.23 appropriate individual or group captions or subcaptions as the 1.24 commissioner may approve. 1.25 (1) A provision as follows: 1.26 ENTIRE CONTRACT; CHANGES: This policy, including the 2.1 endorsements and the attached papers,if any,constitutes the 2.2 entire contract of insurance. No change in this policyshall be2.3 is valid until approved by an executive officer of the insurer 2.4 and unlesssuchthe approvalbeis endorsedhereonor attached 2.5hereto.NoAn agenthas authority tomay not change this 2.6 policy ortowaive any of its provisions. 2.7 (2) A provision as follows: 2.8 TIME LIMIT ON CERTAIN DEFENSES: (a) MISSTATEMENTS IN THE 2.9 APPLICATION: After two years from the date of issue of this 2.10 policy no misstatements, except fraudulent misstatements, made 2.11 by the applicant in the application forsuchthe policyshall2.12 may be used to void the policy or to deny a claim for loss 2.13 incurred or disability (as defined in the policy) commencing 2.14 after the expiration ofsuchthe two-year period. 2.15 The foregoing policy provision shall not be so construed as 2.16 to affect any legal requirement for avoidance of a policy or 2.17 denial of a claim duringsuchthe initial two-year period, nor 2.18 to limit the application of clauses (1), (2), (3), (4) and (5), 2.19 in the event of misstatement with respect to age or occupation 2.20 or other insurance. A policy which the insured has the right to 2.21 continue in force subject to its terms by the timely payment of 2.22 premium (1) until at least age 50 or, (2) in the case of a 2.23 policy issued after age 44, for at least five years from its 2.24 date of issue, may contain in lieu of the foregoing the 2.25 following provisions (from which the clause in parentheses may 2.26 be omitted at the insurer's option) under the caption 2.27 "INCONTESTABLE": 2.28 After this policy has been in force for a period of two 2.29 years during the lifetime of the insured (excluding any period 2.30 during which the insured is disabled), itshall becomeis 2.31 incontestable as to the statements contained in the application. 2.32 (b) PREEXISTING CONDITIONS: No claim for loss incurredor2.33disability (as defined in the policy)commencing after two years 2.34 from the date of issue of this policy shall be reduced or denied 2.35 on the ground that a disease or physical condition not excluded 2.36 from coverage by name or specific description effective on the 3.1 date of loss had existed prior to the effective date of coverage 3.2 of this policy. 3.3 (3) A provision as follows: 3.4 GRACE PERIOD: A grace period of ..... (insert a number not 3.5 less than "7" for weekly premium policies, "10" for monthly 3.6 premium policies and "31" for all other policies) days will be 3.7 granted for the payment of each premium falling due after the 3.8 first premium, during which grace period the policy shall 3.9 continue in force. 3.10 A policy which contains a cancellation provision may add, 3.11 at the end of the above provision, 3.12 subject to the right of the insurer to cancel in accordance 3.13 with the cancellation provisionhereof. 3.14 A policy in which the insurer reserves the right to refuse 3.15 any renewal shall have, at the beginning of the above provision, 3.16 Unless not less than five days prior to the premium due 3.17 date the insurer has delivered to the insured or has mailed to 3.18 the insured's last address as shown by the records of the 3.19 insurer written notice of its intention not to renew this policy 3.20 beyond the period for which the premium has been accepted. 3.21 (4) A provision as follows: 3.22 REINSTATEMENT: Ifanya renewal premiumbeis not paid 3.23 within the time granted the insured for payment, a subsequent 3.24 acceptance of premium by the insurer or byanyan agentduly3.25 authorized by the insurer to acceptsuchthe premium, without 3.26 requiringin connection therewithan application for 3.27 reinstatement,shall reinstatereinstates the policy. If the 3.28 insurer orsuchagent requires an application for reinstatement 3.29 and issues a conditional receipt for the premium tendered, the 3.30 policywill beis reinstatedupon approval of such application3.31bywhen the insurer approves the application or,lacking such3.32 without approval,uponon the forty-fifth day following the date 3.33 ofsuchthe conditional receipt unless the insurer has 3.34 previously notified the insured in writing of its disapproval of 3.35suchthe application. For health plans described in section 3.36 62A.011, subdivision 3, clause (10), an insurer must accept 4.1 payment of a renewal premium and reinstate the policy, if the 4.2 insured applies for reinstatement no later than 60 days after 4.3 the due date for the premium payment, unless: 4.4 (1) the insured has in the interim left the state or the 4.5 insurer's service area; or 4.6 (2) the insured has applied for reinstatement on two or 4.7 more prior occasions. 4.8 Coverage under the reinstated policyshall cover onlyis 4.9 limited to loss resulting fromsuchaccidental injuryas may be4.10 sustained after the date of reinstatement and loss due tosuch4.11sickness as may beginan illness that begins more than ten days 4.12 aftersuchthe reinstatement date. In all other respects the 4.13 insured and insurershallhave the same rightsthereunderas 4.14 they had under the policy immediately before the due date of the 4.15 defaulted premium, subject to any provisions endorsedhereonor 4.16 attachedheretoin connection with the reinstatement.Any4.17 Premium accepted in connection with a reinstatementshallmust 4.18 be applied to a period for which premium has not been previously 4.19 paid, but not toanya period more than 60 daysprior tobefore 4.20 the date of reinstatement. The last sentence of the above 4.21 provision may be omitted fromanya policy which the insured has 4.22 the right to continue in force subject to its terms by the 4.23 timely payment of premiums (1) until at least age 50, or, (2) in 4.24 the case of a policy issued after age 44, for at least five 4.25 years from its date of issue. 4.26 (5) A provision as follows: 4.27 NOTICE OF CLAIM: Written notice of claim must be given to 4.28 the insurer within 20 days after the occurrence or commencement 4.29 ofanyloss covered by the policy, or as soon thereafter as is 4.30 reasonably possible. Notice given by or on behalf of the 4.31 insured or the beneficiary to the insurer at ..... (insert the 4.32 location ofsuchthe officeasdesignated by the insurermay4.33designate for the purpose), or toanyan authorized agent of the 4.34 insurer, with information sufficient to identify the 4.35 insured,shall be deemedconstitutes notice to the insurer. 4.36In a policy providing a loss-of-time benefit which may be5.1payable for at least two years, an insurer may at its option5.2insert the following between the first and second sentences of5.3the above provision:5.4Subject to the qualifications set forth below, if the5.5insured suffers loss of time on account of disability for which5.6indemnity may be payable for at least two years, the insured5.7shall, at least once in every six months after having given5.8notice of claim, give to the insurer notice of continuance of5.9said disability, except in the event of legal incapacity. The5.10period of six months following any filing of proof by the5.11insured or any payment by the insurer on account of such claim5.12or any denial of liability in whole or in part by the insurer5.13shall be excluded in applying this provision. Delay in the5.14giving of such notice shall not impair the insured's right to5.15any indemnity which would otherwise have accrued during the5.16period of six months preceding the date on which such notice is5.17actually given.5.18 (6) A provision as follows: 5.19 CLAIM FORMS: The insurer, upon receipt of a notice of 5.20 claim,will furnishmust provide proof of loss forms to the 5.21 claimantsuch forms as are usually furnished by it for filing5.22proofs of loss. Ifsuchthe forms are not furnished within 15 5.23 days after the giving ofsuchnotice, the claimantshall be5.24deemedis considered to have complied with the requirements of 5.25 this policy as to proof of loss upon submitting, within the time 5.26fixedspecified in the policy for filing proofs of loss, written 5.27 proof covering the occurrence, and the character andtheextent 5.28 of the loss for which the claim is made. 5.29 (7) A provision as follows: 5.30 PROOFS OF LOSS: Written proof of loss must be furnished to 5.31 the insurer at itssaidoffice in case of claim for loss for 5.32 which this policy providesanya periodic payment contingent 5.33 upon continuing loss within 90 days after the termination of the 5.34 period for which the insurer is liable and in case of claim for 5.35 any other loss within 90 days after the date ofsuchthe loss. 5.36 Failure to furnishsuchproof within the time required shall not 6.1 invalidate nor reduceanya claim if it was not reasonably 6.2 possible to give proof withinsuchthe specified time, provided 6.3suchthat proof is furnished as soon as reasonably possible and 6.4 in no event, except in the absence of legal capacity, later than 6.5 one year from the time proof is otherwise required. 6.6 (8) A provision as follows: 6.7 TIME OF PAYMENT OF CLAIMS: Indemnities payable under this 6.8 policy foranya loss other than loss for which this policy 6.9 provides periodic payment will be paid immediately upon receipt 6.10 of due written proof ofsuchthe loss. Subject to due written 6.11 proof of loss, all accrued indemnities for loss for which this 6.12 policy provides periodic payment will be paid ..... (insert 6.13 period for payment which must not be less frequently than 6.14 monthly) and any balance remaining unpaid upon the termination 6.15 of liability will be paid immediately upon receipt of due 6.16 written proof. 6.17 (9) A provision as follows: 6.18 PAYMENT OF CLAIMS: Indemnity for loss of lifewill beis 6.19 payable in accordance with the beneficiary designation and the 6.20 policy provisionsrespecting suchthat apply to the payment 6.21which may be prescribed hereinand that are effective at the 6.22 time of payment. If nosuchdesignation or provision is then 6.23 effective,suchthe indemnityshall beis payable to the estate 6.24 of the insured.AnyThe insurer may pay other accrued 6.25 indemnities unpaid at the insured's deathmay, at the option of6.26the insurer, be paidto eitherto suchthe beneficiary orto6.27suchthe estate. All other indemnitieswill beare payable to 6.28 the insured. 6.29 The insurer may include the following provisions, or either 6.30 of them,may be includedwith the foregoing provisionat the6.31option of the insurer: 6.32 Ifanyan indemnity of this policyshall beis payable to 6.33 the estate of the insured, or to an insured or beneficiary who 6.34 is a minor or otherwise not competent to give a valid release, 6.35 the insurer may paysuchthe indemnity, up to an amount not 6.36 exceeding $..... (insert an amount which shall not exceed 7.1 $1,000), toanya relative by blood or connection by marriage of 7.2 the insured or beneficiary who isdeemedconsidered by the 7.3 insurer to be equitably entitledthereto.AnyA payment made by 7.4 the insurer in good faithpursuant tounder this provisionshall7.5fully dischargecompletely discharges the insurer to the extent 7.6 ofsuchthe payment. 7.7Subject to any written direction ofUnless otherwise 7.8 directed in writing by the insured in the application 7.9 orotherwise all or a portion of any indemnitiesno later than 7.10 the time of filing proofs of the loss, an insurer may pay an 7.11 indemnity provided by this policyon account offor hospital, 7.12 nursing, medical, or surgical servicesmay, at the insurer's7.13option and unless the insured requests otherwise in writing not7.14later than the time of filing proofs of such loss, be paid7.15 directly to the hospital or personrendering such services; but7.16it is not required thatproviding the service. This provision 7.17 does not require the service to berenderedprovided by a 7.18 particular hospital or person. 7.19 (10) A provision as follows: 7.20PHYSICALEXAMINATIONS AND AUTOPSY: The insurer at its own 7.21 expenseshall have the right and opportunity tomay examine the 7.22 person of the insured when and as often asit may reasonably7.23requirereasonable during the pendency of a claimhereunderand 7.24to makemay require an autopsy to be performed in case of death 7.25 where it is not forbidden by law. 7.26 (11) A provision as follows: 7.27 LEGAL ACTIONS: No action at law or in equityshallmay be 7.28 brought to recover on this policyprior tobefore the expiration 7.29 of 60 days after written proof of loss has been furnished in 7.30 accordance with the requirements of this policy. Nosuchaction 7.31shallmay be brought after the expiration of three years after 7.32 the time written proof of loss is required to be furnished. 7.33 (12) A provision as follows: 7.34 CHANGE OF BENEFICIARY: Unless the insured makes an 7.35 irrevocable designation of beneficiary, the right to changeof7.36 the beneficiary is reserved to the insured and the consent of 8.1 the beneficiaryor beneficiaries shall not be requisite tois 8.2 not required for the surrender or assignment of this policyor8.3to any, a change of beneficiaryor beneficiaries, orto any8.4 other changes in this policy. The insurer may omit the first 8.5 clause of this provision,relating to the irrevocable 8.6 designation of beneficiary, may be omitted at the insurer's8.7option. 8.8 Sec. 2. Minnesota Statutes 1996, section 62A.04, 8.9 subdivision 3, is amended to read: 8.10 Subd. 3. [OPTIONAL PROVISIONS.] Except as provided in 8.11 subdivision 4, nosuchpolicy of accident and sickness insurance 8.12 delivered or issued for delivery toanya person in this 8.13 stateshallother than a policy that is limited to disability or 8.14 income protection coverage may contain provisions respecting the 8.15 mattersset forthspecified below unlesssuchthe provisions are 8.16 in the wordsin which the same appearprovided in this section. 8.17 The insurer may, at its option,usein lieu of any such8.18provisiona corresponding provision of different wording 8.19 approved by the commissioner which is not less favorable in any 8.20 respect to the insured or the beneficiary.Any suchA provision 8.21 contained in the policyshallmust be preceded individually by 8.22 the appropriate caption appearing in this subdivisionor, at the8.23option of. The insurer, by suchmay use an appropriate 8.24 alternative individual or groupcaptions or subcaptions8.25ascaption if approved by the commissionermay approve. 8.26 (1) A provision as follows: 8.27 CHANGE OF OCCUPATION: If the insuredbeis injured or 8.28contract sicknesscontracts an illness afterhaving changed8.29 changing occupations to one classified by the insurer as more 8.30 hazardous than that stated in this policy or while doing for 8.31 compensation anything pertaining to an occupation so classified, 8.32 the insurer will pay onlysuchthe portion of the indemnities 8.33 provided in this policy as the premiums paid would have 8.34 purchased at the rates and within the limits fixed by the 8.35 insurer forsuchthe more hazardous occupation. If the insured 8.36 changes occupations to one classified by the insurer as less 9.1 hazardous than that stated in this policy, the insurer, upon 9.2 receipt of proof ofsuchthe change of occupation will reduce 9.3 the premium rate accordingly, and will return the excess pro 9.4 rata unearned premium from the date of change of occupation or 9.5 from the policy anniversary date immediately preceding receipt 9.6 ofsuchthe proof, whichever is the more recent.In applying9.7this provision,The classification of occupational risk and the 9.8 premium ratesshall be such as have beenlast filed by the 9.9 insurerprior to: (a) before the occurrence of the loss for 9.10 which the insurer is liable; orprior to(b) before the date of 9.11 proof of change in occupation with the state official having 9.12 supervision of insurance in the state where the insured resided 9.13 at the time this policy was issued;butapply to this 9.14 provision. Ifsuchfilingwasis not required, then the 9.15 classification of occupational risk and the premium ratesshall9.16be thoselast made effective by the insurer insuchthe 9.17 stateprior tobefore the occurrence of the loss orprior to9.18 before the date of proof of change of occupation apply to this 9.19 provision. 9.20 (2) A provision as follows: 9.21 MISSTATEMENT OF AGE: If the age of the insured has been 9.22 misstated, all amounts payable under this policyshall be such9.23 are the same as the premium paid would have purchased at the 9.24 correct age. 9.25 (3) A provision as follows: 9.26 OTHER INSURANCE IN THIS INSURER: If anaccident or9.27sickness oraccident and sickness policyor policiespreviously 9.28 issued by the insurer to the insuredbeis concurrently in force 9.29concurrently herewith, makingand the aggregate indemnity for 9.30 ..... (insert type of coverage or coverages) is in excess of 9.31 $..... (insert maximum limit of indemnity or indemnities) the 9.32 excess insuranceshall beis void and all premiums paid forsuch9.33 the excessshallmust be returned to the insured or to the 9.34 insured's estate, or, in lieu thereof:insurance effective at 9.35 any one time on the insured under alikesimilar policyor9.36policies inof this insurer is limited to the onesuchpolicy 10.1 elected by the insured, or the insured's beneficiary or estate, 10.2 as the case may be, and the insurer will return all premiums 10.3 paid for all othersuchpolicies. 10.4 (4) A provision as follows: 10.5 INSURANCE WITH OTHER INSURERS: If therebeis other valid 10.6 coverage, not with this insurer, providing benefits for the same 10.7 loss on a provision of service basis or on an expense incurred 10.8 basis and of which this insurer has not been given written 10.9 noticeprior tobefore the occurrence or commencement of loss, 10.10 the only liability underanyexpense incurred coverage of this 10.11 policyshall beis forsuchthe proportion of the loss as the 10.12 amount which would otherwise have been payablehereunderunder 10.13 the policy plus the total of the like amounts under allsuch10.14 other valid coverages for the same loss of which this insurer 10.15 had notice bears to the total like amounts under all valid 10.16 coverages forsuchthe loss, and for the return ofsuchthe 10.17 portion of the premiums paidas shall exceedthat exceeds the 10.18 pro rata portion for the amount so determined. For the purpose 10.19 of applying this provision when other coverage is on a provision 10.20 of service basis, the "like amount" ofsuchthe other 10.21 coverageshall be taken asis the amount which the services 10.22renderedprovided would have cost in the absence ofsuchthe 10.23 coverage. 10.24 Ifthe foregoing policy provisionclause (4) is included in 10.25 a policy which also contains thenextfollowing policy provision 10.26there shall be added to the caption of the foregoing provision, 10.27 the phrase "EXPENSE INCURRED BENEFITS." must be added to the 10.28 caption specified under clause (4). The insurer may, at its10.29option,include in this provision a definition of "other valid 10.30 coverage,"approved as toin a form approved by the commissioner 10.31, which. The definitionshall beis limited in subject matter 10.32 to coverage provided by organizations subject to regulation by 10.33 insurance law or by insurance authorities of this orany other10.34 another state of the United States oranya province of Canada, 10.35 and by hospital or medical service organizations, and to any 10.36 other coverage the inclusion of which may be approved by the 11.1 commissioner. In the absence ofsucha definitionsuch, the 11.2 termshalldoes not include group insurance, automobile medical 11.3 payments insurance, or coverage provided by hospital or medical 11.4 service organizations or by union welfare plans or employer or 11.5 employee benefit organizations. For the purpose of applyingthe11.6foregoingthis policy provision with respect toanyan insured, 11.7 any amount of benefit provided forsuchthe insuredpursuant to11.8anyunder a compulsory benefit statute (includinganya workers' 11.9 compensation or employer's liability statute) whether provided 11.10 by a governmental agency or otherwiseshall in all cases be11.11deemedis considered to be "other valid coverage" of which the 11.12 insurer has had notice. In applyingthe foregoingthis policy 11.13 provisionno, third party liability coverageshallmay not be 11.14 included as "other valid coverage." 11.15 (5) A provision as follows: 11.16 INSURANCE WITH OTHER INSURERS: If therebeis other valid 11.17 coverage, not with this insurer, providing benefits for the same 11.18 loss on other than an expense incurred basis and of which this 11.19 insurer has not been given written noticeprior tobefore the 11.20 occurrence or commencement of loss, the only liability forsuch11.21 the benefits under this policyshall beis forsuchthe 11.22 proportion of the indemnities otherwise providedhereunderunder 11.23 this policy forsuchthe loss as the like indemnities of which 11.24 the insurer had notice (including the indemnities under this 11.25 policy) bear to the total amount of all like indemnities 11.26 forsuchthe loss, and for the return ofsuchthe portion of the 11.27 premium paidas shall exceedthat exceeds the pro rata portion 11.28 for the indemnitiesthusas determined under this provision. 11.29 Ifthe foregoing policy provisionclause (5) is included in 11.30 a policy which also contains thenext precedingfollowing policy 11.31 provisionthere shall be added to the caption of the foregoing11.32provision, the phrase -- "OTHER BENEFITS." must be added to the 11.33 caption specified in clause (5). The insurer may, at its11.34option,include in this provision a definition of "other valid 11.35 coverage," approved as to form by the commissioner, which. The 11.36 definitionshall beis limited in subject matter to coverage 12.1 provided by organizations subject to regulation by insurance law 12.2 or by insurance authorities of this orany otheranother state 12.3 of the United States oranya province of Canada, and to any 12.4 other coverage the inclusion of which may be approved by the 12.5 commissioner. In the absence ofsucha definitionsuch, the 12.6 termshalldoes not include group insurance, or benefits 12.7 provided by union welfare plans or by employer or employee 12.8 benefit organizations. For the purpose of applyingthe12.9foregoingthis policy provision with respect toanyan insured, 12.10 any amount of benefit provided forsuchthe insuredpursuant to12.11anyunder a compulsory benefit statute (includinganya workers' 12.12 compensation or employer's liability statute) whether provided 12.13 by a governmental agency or otherwiseshall in all cases be12.14deemedis considered to be "other valid coverage" of which the 12.15 insurer has had notice. In applyingthe foregoingthis policy 12.16 provisionno, third party liability coverageshallmay not be 12.17 included as "other valid coverage." 12.18 (6)A provision as follows:12.19RELATION OF EARNINGS TO INSURANCE: If the total monthly12.20amount of loss of time benefits promised for the same loss under12.21all valid loss of time coverage upon the insured, whether12.22payable on a weekly or monthly basis, shall exceed the monthly12.23earnings of the insured at the time disability commenced or the12.24insured's average monthly earnings for the period of two years12.25immediately preceding a disability for which claim is made,12.26whichever is the greater, the insurer will be liable only for12.27such proportionate amount of such benefits under this policy as12.28the amount of such monthly earnings or such average monthly12.29earnings of the insured bears to the total amount of monthly12.30benefits for the same loss under all such coverage upon the12.31insured at the time such disability commences and for the return12.32of such part of the premiums paid during such two years as shall12.33exceed the pro rata amount of the premiums for the benefits12.34actually paid hereunder; but this shall not operate to reduce12.35the total monthly amount of benefits payable under all such12.36coverage upon the insured below the sum of $200 or the sum of13.1the monthly benefits specified in such coverages, whichever is13.2the lesser, nor shall it operate to reduce benefits other than13.3those payable for loss of time.13.4The foregoing policy provision may be inserted only in a13.5policy which the insured has the right to continue in force13.6subject to its terms by the timely payment of premiums (1) until13.7at least age 50, or, (2) in the case of a policy issued after13.8age 44, for at least five years from its date of issue. The13.9insurer may, at its option, include in this provision a13.10definition of "valid loss of time coverage," approved as to form13.11by the commissioner, which definition shall be limited in13.12subject matter to coverage provided by governmental agencies or13.13by organizations subject to regulation by insurance law or by13.14insurance authorities of this or any other state of the United13.15States or any province of Canada, or to any other coverage the13.16inclusion of which may be approved by the commissioner or any13.17combination of such coverages. In the absence of such13.18definition such term shall not include any coverage provided for13.19such insured pursuant to any compulsory benefit statute13.20(including any workers' compensation or employer's liability13.21statute), or benefits provided by union welfare plans or by13.22employer or employee benefit organizations.13.23(7)A provision as follows: 13.24 UNPAID PREMIUM:Upon the payment of a claim under this13.25policy, anyPremiumthenthat is due and unpaid or covered by 13.26anya note or written order may be deductedtherefromfrom the 13.27 payment of a claim under this policy. 13.28(8)(7) A provision as follows: 13.29 CANCELLATION: The insurer may cancel this policy at any 13.30 time by written notice delivered to the insured or mailed to the 13.31 insured's last address as shown by the records of the insurer, 13.32 stating when, not less than five days thereafter,suchthe 13.33 cancellationshall beis effective; and after the policy has 13.34 been continued beyond its original term the insured may cancel 13.35 this policy at any time by written notice delivered or mailed to 13.36 the insurer, effective upon receipt or onsucha later date as 14.1 may be specified insuchthe notice. In the event of 14.2 cancellation, the insurerwillmust promptly returnpromptlythe 14.3 unearned portion of any premium paid. If the insured cancels, 14.4 the earned premiumshallmust be computed by the use of the 14.5 short-rate table last filed with the state official having 14.6 supervision of insurance in the state where the insured resided 14.7 when the policy was issued. If the insurer cancels, the earned 14.8 premiumshallmust be computed pro rata. Cancellationshall be14.9 is without prejudice to any claim originatingprior tobefore 14.10 the effective date of cancellation. 14.11(9)(8) A provision as follows: 14.12 CONFORMITY WITH STATE STATUTES: Any provision of this 14.13 policy which, on its effective date, is in conflict with the 14.14 statutes of the state in which the insured resides onsuchthe 14.15 date isherebyamended to conform to the minimum requirements of 14.16suchthe statutes. 14.17(10)(9) A provision as follows: 14.18 ILLEGAL OCCUPATION: The insurershallis notbeliable for 14.19 any loss to which a contributing cause was the insured's 14.20 commission of or attempt to commit a felony or to which a 14.21 contributing cause was the insured's being engaged in an illegal 14.22 occupation. 14.23(11)(10) A provision as follows: 14.24 NARCOTICS: The insurershallis notbeliable for any loss 14.25 sustained or contracted in consequence of the insured's being 14.26 under the influence of any narcotic unless administered on the 14.27 advice of a physician. 14.28 Sec. 3. [62A.0405] [STANDARD PROVISIONS; DISABILITY 14.29 POLICIES.] 14.30 Subdivision 1. [REQUIRED PROVISIONS.] Except as provided 14.31 in subdivision 3, each disability or income protection policy 14.32 delivered or issued for delivery to a person in this state shall 14.33 contain the provisions specified in this subdivision in the 14.34 words in which the same appear in this section. The insurer may 14.35 substitute for one or more of the provisions corresponding 14.36 provisions of different wording approved by the commissioner 15.1 which are in each instance not less favorable in any respect to 15.2 the insured or the beneficiary. The provisions must be preceded 15.3 individually by the caption appearing in this subdivision or, at 15.4 the option of the insurer, by appropriate individual or group 15.5 captions or subdivisions as the commissioner may approve. 15.6 (1) A provision as follows: 15.7 ENTIRE CONTRACT; CHANGES: This policy, including the 15.8 endorsements and the attached papers, constitutes the entire 15.9 contract of insurance. No change in this policy is valid until 15.10 approved by an executive officer of the insurer and unless the 15.11 approval is endorsed or attached. An agent may not change this 15.12 policy or waive any of its provisions. 15.13 (2) A provision as follows: 15.14 TIME LIMIT ON CERTAIN DEFENSES: (a) MISSTATEMENTS IN THE 15.15 APPLICATION: After two years from the date of issue of this 15.16 policy, no misstatements, except fraudulent misstatements made 15.17 by the applicant in the application for the policy, may be used 15.18 to void the policy or to deny a claim for loss incurred or 15.19 disability (as defined in the policy) beginning after the 15.20 expiration of the two-year period. 15.21 The foregoing policy provisions shall not be so construed 15.22 as to affect any legal requirement for avoidance of a policy or 15.23 denial of a claim during the initial two-year period, nor to 15.24 limit the application of clauses (1), (2), (3), (4), and (5), in 15.25 the event of misstatement with respect to age or occupation or 15.26 other insurance. A policy which the insured has the right to 15.27 continue in force subject to its terms by the timely payment of 15.28 premium: (1) until at least age 50; or (2) in the case of a 15.29 policy issued after age 44, for at least five years from its 15.30 date of issue, may contain in lieu of the foregoing the 15.31 following provisions (from which the clause in parentheses may 15.32 be omitted at the insurer's option) under the caption 15.33 "INCONTESTABLE": 15.34 After this policy has been in force for a period of two 15.35 years during the lifetime of the insured (excluding any period 15.36 during which the insured is disabled), it is incontestable as to 16.1 the statements contained in the application. 16.2 (b) PREEXISTING CONDITIONS: No claim for loss incurred or 16.3 disability (as defined in the policy) that begins more than two 16.4 years after the date of issue of this policy shall be reduced or 16.5 denied because a disease or physical condition existed prior to 16.6 the effective date of coverage of this policy, unless excluded 16.7 by name or specific description in this contract. 16.8 (3) A provision as follows: 16.9 GRACE PERIOD: A grace period of ..... (insert a number not 16.10 less than "7" for weekly premium policies, "10" for monthly 16.11 premium policies, and "31" for all other policies) days will be 16.12 granted for the payment of each premium falling due after the 16.13 first premium, during which grace period the policy shall 16.14 continue in force. 16.15 A policy which contains a cancellation provision may add, 16.16 at the end of the above provision, 16.17 subject to the right of the insurer to cancel in accordance 16.18 with the cancellation provision. 16.19 A policy in which the insurer reserves the right to refuse 16.20 any renewal shall have, at the beginning of the above provision, 16.21 Unless not less than five days prior to the premium due 16.22 date the insurer has delivered to the insured or has mailed to 16.23 the insured's last address as shown by the records of the 16.24 insurer written notice of its intention not to renew this policy 16.25 beyond the period for which the premium has been accepted. 16.26 (4) A provision as follows: 16.27 REINSTATEMENT: If a renewal premium is not paid within the 16.28 time granted the insured for payment, a subsequent acceptance of 16.29 premium by the insurer or by an agent authorized by the insurer 16.30 to accept the premium, without requiring an application for 16.31 reinstatement, reinstates the policy. If the insurer requires 16.32 an application for reinstatement and issues a conditional 16.33 receipt for the premium tendered, the policy is reinstated when 16.34 the insurer approves the application or, without approval, on 16.35 the forty-fifth day following the date of the conditional 16.36 receipt unless the insurer has previously notified the insured 17.1 in writing of its disapproval of the application. 17.2 Coverage under the reinstated policy is limited to loss 17.3 resulting from accidental injury sustained after the date of 17.4 reinstatement and loss due to an illness or disease that begins 17.5 more than ten days after the reinstatement date. In all other 17.6 respects the insured and insurer have the same rights as they 17.7 had under the policy immediately before the due date of the 17.8 defaulted premium, subject to any provisions endorsed or 17.9 attached in connection with the reinstatement. Premium accepted 17.10 in connection with a reinstatement must be applied to a period 17.11 for which premium has not been previously paid, but not to a 17.12 period more than 60 days before the date of reinstatement. The 17.13 last sentence of the above provision may be omitted from a 17.14 policy which the insured has the right to continue in force 17.15 subject to its terms by the timely payment of premiums: (1) 17.16 until at least age 50; or (2) in the case of a policy issued 17.17 after age 44, for at least five years from its date of issue. 17.18 (5) A provision as follows: 17.19 NOTICE OF CLAIM: Written notice of claim must be given to 17.20 the insurer within 20 days after the occurrence or commencement 17.21 of loss covered by the policy, or as soon thereafter as is 17.22 reasonably possible. Notice given by or on behalf of the 17.23 insured or the beneficiary to the insurer at ..... (insert the 17.24 location of the office designated by the insurer), or to an 17.25 authorized agent of the insurer, with information sufficient to 17.26 identify the insured, constitutes notice to the insurer. 17.27 In a policy providing a loss-of-time benefit which may be 17.28 payable for at least two years, an insurer may at its option 17.29 insert the following between the first and second sentences of 17.30 the above provision: 17.31 Subject to the qualifications specified below, if the 17.32 insured suffers loss of time on account of disability for which 17.33 indemnity may be payable for at least two years, the insured 17.34 shall, at least once in every six months after having given 17.35 notice of claim, give to the insurer notice of continuance of 17.36 the disability, except in the event of legal incapacity. This 18.1 provision does not apply to the six-month period following a 18.2 filing of proof by the insured, a payment by the insurer on the 18.3 claim, or a denial of liability in whole or in part by the 18.4 insurer. Delay in providing notice does not impair the 18.5 insured's right to an indemnity which would otherwise have 18.6 accrued during the period of six months preceding the date on 18.7 which the notice is actually given. 18.8 (6) A provision as follows: 18.9 CLAIM FORMS: The insurer, upon receipt of a notice of 18.10 claim, must provide proof of loss forms to the claimant. If the 18.11 forms are not furnished within 15 days after the giving of 18.12 notice, the claimant is considered to have complied with the 18.13 requirements of this policy as to proof of loss upon submitting, 18.14 within the time specified in the policy for filing proofs of 18.15 loss, written proof covering the occurrence, and the character 18.16 and extent of the loss for which the claim is made. 18.17 (7) A provision as follows: 18.18 PROOFS OF LOSS: Written proof of loss must be furnished to 18.19 the insurer at its office in case of claim for loss for which 18.20 this policy provides a periodic payment contingent upon 18.21 continuing loss within 90 days after the termination of the 18.22 period for which the insurer is liable and in case of claim for 18.23 any other loss within 90 days after the date of the loss. 18.24 Failure to furnish proof within the time required shall not 18.25 invalidate nor reduce a claim if it was not reasonably possible 18.26 to give proof within the specified time, provided that proof is 18.27 furnished as soon as reasonably possible and in no event, except 18.28 in the absence of legal capacity, later than one year from the 18.29 time proof is otherwise required. 18.30 (8) A provision as follows: 18.31 TIME OF PAYMENT OF CLAIMS: Indemnities payable under this 18.32 policy for a loss other than loss for which this policy provides 18.33 periodic payment will be paid immediately upon receipt of due 18.34 written proof of the loss. Subject to due written proof of 18.35 loss, all accrued indemnities for loss for which this policy 18.36 provides periodic payment will be paid ..... (insert period for 19.1 payment which must not be less frequently than monthly) and any 19.2 balance remaining unpaid upon the termination of liability will 19.3 be paid immediately upon receipt of due written proof. 19.4 (9) A provision as follows: 19.5 PAYMENT OF CLAIMS: Indemnity for loss of life is payable 19.6 in accordance with the beneficiary designation and the policy 19.7 provisions that apply to the payment and that are effective at 19.8 the time of payment. If no designation or provision is then 19.9 effective, the indemnity is payable to the estate of the 19.10 insured. The insurer may pay other accrued indemnities unpaid 19.11 at the insured's death to either the beneficiary or the estate. 19.12 All other indemnities are payable to the insured. 19.13 The insurer may include the following provisions, or either 19.14 of them, with the foregoing provision: 19.15 If an indemnity of this policy is payable to the estate of 19.16 the insured, or to an insured or beneficiary who is a minor or 19.17 otherwise not competent to give a valid release, the insurer may 19.18 pay the indemnity, up to an amount not exceeding $..... (insert 19.19 an amount which shall not exceed $1,000), to a relative by blood 19.20 or connection by marriage of the insured or beneficiary who is 19.21 considered by the insurer to be equitably entitled. A payment 19.22 made by the insurer in good faith under this provision 19.23 completely discharges the insurer to the extent of the payment. 19.24 (10) A provision as follows: 19.25 EXAMINATIONS AND AUTOPSY: The insurer at its own expense 19.26 may examine the person of the insured when and as often as 19.27 reasonable during the pendency of a claim and may require an 19.28 autopsy to be performed in case of death where it is not 19.29 forbidden by law. 19.30 (11) A provision as follows: 19.31 LEGAL ACTIONS: No action at law or in equity may be 19.32 brought to recover on this policy before the expiration of 60 19.33 days after written proof of loss has been furnished in 19.34 accordance with the requirements of this policy. No action may 19.35 be brought after the expiration of three years after the time 19.36 written proof of loss is required to be furnished. 20.1 (12) A provision as follows: 20.2 CHANGE OF BENEFICIARY: Unless the insured makes an 20.3 irrevocable designation of beneficiary, the right to change the 20.4 beneficiary is reserved to the insured and the consent of the 20.5 beneficiary is not required for the surrender or assignment of 20.6 this policy, a change of beneficiary, or other changes in this 20.7 policy. The insurer may omit the first clause of this provision 20.8 relating to the irrevocable designation of beneficiary. 20.9 Subd. 2. [OPTIONAL PROVISIONS.] Except as provided in 20.10 subdivision 3, no disability or income protection policy 20.11 delivered or issued for delivery to a person in this state may 20.12 contain provisions respecting the matters specified below unless 20.13 the provisions are in the words provided in this section. The 20.14 insurer may use a corresponding provision of different wording 20.15 approved by the commissioner which is not less favorable in any 20.16 respect to the insured or the beneficiary. A provision 20.17 contained in the policy must be preceded individually by the 20.18 appropriate caption appearing in this subdivision. The insurer 20.19 may use an appropriate alternative individual or group caption 20.20 if approved by the commissioner. 20.21 (1) A provision as follows: 20.22 CHANGE OF OCCUPATION: If the insured is injured or 20.23 contracts an illness after changing occupations to one 20.24 classified by the insurer as more hazardous than that stated in 20.25 this policy or while doing for compensation anything pertaining 20.26 to an occupation so classified, the insurer will pay only the 20.27 portion of the indemnities provided in this policy as the 20.28 premiums paid would have purchased at the rates and within the 20.29 limits fixed by the insurer for the more hazardous occupation. 20.30 If the insured changes occupations to one classified by the 20.31 insurer as less hazardous than that stated in this policy, the 20.32 insurer, upon receipt of proof of the change of occupation will 20.33 reduce the premium rate accordingly, and will return the excess 20.34 pro rata unearned premium from the date of change of occupation 20.35 or from the policy anniversary date immediately preceding 20.36 receipt of the proof, whichever is the more recent. The 21.1 classification of occupational risk and the premium rates last 21.2 filed by the insurer: (a) before the occurrence of the loss for 21.3 which the insurer is liable apply to this provision; or (b) 21.4 before the date of proof of change in occupation with the state 21.5 official having supervision of insurance in the state where the 21.6 insured resided at the time this policy was issued apply to this 21.7 provision. If filing is not required, then the classification 21.8 of occupational risk and the premium rates last made effective 21.9 by the insurer in the state before the occurrence of the loss or 21.10 before the date of proof of change of occupation apply to this 21.11 provision. 21.12 (2) A provision as follows: 21.13 MISSTATEMENT OF AGE: If the age of the insured has been 21.14 misstated, all amounts payable under this policy are the same as 21.15 the premium paid would have purchased at the correct age. 21.16 (3) A provision as follows: 21.17 INSURANCE WITH OTHER INSURERS: If there is other valid 21.18 disability insurance coverage, not with this insurer, of which 21.19 this insurer has not been given written notice before the 21.20 occurrence or commencement of loss or which coverage has been 21.21 misstated, all amounts payable under this policy are limited to 21.22 the amount of coverage which would have been issued by this 21.23 insurer had the amount of the other insurance been disclosed. 21.24 If the amount of other valid disability insurance coverage, 21.25 not with this insurer, of which the insurer has not been given 21.26 written notice before the occurrence or commencement of loss or 21.27 which amount has been misstated, exceeds the amount of insurance 21.28 this insurer would have issued, liability under this policy is 21.29 limited to a refund of premium. 21.30 If the amount of other valid disability insurance has been 21.31 misstated, the amount, type, and duration of the benefits 21.32 payable under this policy or any agreement attached to this 21.33 policy will be that amount, type, and duration of benefits which 21.34 the premiums paid would have purchased based upon your correct 21.35 disclosure of other valid disability insurance coverage. 21.36 (4) A provision as follows: 22.1 OTHER INSURANCE IN THIS INSURER: If a disability or income 22.2 protection policy issued by the insurer to the insured is 22.3 concurrently in force and the aggregate indemnity for ....... 22.4 (insert type of coverage or coverages) is in excess of $....... 22.5 (insert maximum limit of indemnity or indemnities) the excess 22.6 insurance is void and all premiums paid for the excess must be 22.7 returned to the insured or to the insured's estate, or insurance 22.8 effective at any one time on the insured under a similar policy 22.9 in this insurer is limited to the one policy elected by the 22.10 insured, or the insured's beneficiary or estate, as the case may 22.11 be, and the insurer will return all premiums paid for all other 22.12 policies. 22.13 (5) A provision as follows: 22.14 RELATION OF EARNINGS TO INSURANCE: If the total monthly 22.15 amount of loss of time benefits promised for the same loss under 22.16 all valid loss of time coverage upon the insured, whether 22.17 payable on a weekly or monthly basis, exceeds the monthly 22.18 earnings of the insured at the time disability commenced or the 22.19 insured's average monthly earnings for the period of two years 22.20 immediately preceding a disability for which claim is made, 22.21 whichever is the greater, the insurer is liable only for the 22.22 proportionate amount of the benefits under this policy as the 22.23 amount of the monthly earnings or average monthly earnings of 22.24 the insured bears to the total amount of monthly benefits for 22.25 the same loss under all coverage upon the insured at the time 22.26 the disability commences and for the return of the part of the 22.27 premiums paid during the two years that exceeds the pro rata 22.28 amount of the premiums for the benefits actually paid under the 22.29 policy. This provision does not reduce the total monthly amount 22.30 of benefits payable under all coverage upon the insured below 22.31 the sum of $200 or the sum of the monthly benefits specified in 22.32 the coverages, whichever is the lesser, and does not reduce 22.33 benefits other than those payable for loss of time. 22.34 This policy provision may only be inserted in a policy 22.35 which the insured has the right to continue in force subject to 22.36 its terms by the timely payment of premiums: (1) until at least 23.1 age 50; or (2) in the case of a policy issued after age 44, for 23.2 at least five years from its date of issue. The insurer may 23.3 include in this provision a definition of "valid loss of time 23.4 coverage," in a form approved by the commissioner. The 23.5 definition is limited in subject matter to coverage provided by 23.6 governmental agencies or by organizations subject to regulation 23.7 by insurance law or by insurance authorities of this or another 23.8 state of the United States or a province of Canada, or to any 23.9 other coverage the inclusion of which may be approved by the 23.10 commissioner or a combination of coverages. In the absence of a 23.11 definition, the term does not include any coverage provided for 23.12 the insured under a compulsory benefit statute (including a 23.13 workers' compensation or employer's liability statute), or 23.14 benefits provided by union welfare plans or by employer or 23.15 employee benefit organizations. 23.16 (6) A provision as follows: 23.17 UNPAID PREMIUM: Premium that is due and unpaid or covered 23.18 by a note or written order may be deducted from the payment of a 23.19 claim under this policy. 23.20 (7) A provision as follows: 23.21 CANCELLATION: The insurer may cancel this policy at any 23.22 time by written notice delivered to the insured or mailed to the 23.23 insured's last address as shown by the records of the insurer, 23.24 stating when, not less than five days thereafter, the 23.25 cancellation is effective; and after the policy has been 23.26 continued beyond its original term the insured may cancel this 23.27 policy at any time by written notice delivered or mailed to the 23.28 insurer, effective upon receipt or on a later date as may be 23.29 specified in the notice. In the event of cancellation, the 23.30 insurer must promptly return the unearned portion of any premium 23.31 paid. If the insured cancels, the earned premium must be 23.32 computed by the use of the short-rate table last filed with the 23.33 state official having supervision of insurance in the state 23.34 where the insured resided when the policy was issued. If the 23.35 insurer cancels, the earned premium must be computed pro rata. 23.36 Cancellation is without prejudice to any claim originating 24.1 before the effective date of cancellation. 24.2 (8) A provision as follows: 24.3 CONFORMITY WITH STATE STATUTES: Any provision of this 24.4 policy which, on its effective date, is in conflict with the 24.5 statutes of the state in which the insured resides on the date 24.6 is amended to conform to the minimum requirements of the 24.7 statutes. 24.8 (9) A provision as follows: 24.9 ILLEGAL OCCUPATION: The insurer is not liable for any loss 24.10 to which a contributing cause was the insured's commission of or 24.11 attempt to commit a felony or to which a contributing cause was 24.12 the insured's being engaged in an illegal occupation. 24.13 (10) A provision as follows: 24.14 NARCOTICS: The insurer is not liable for any loss 24.15 sustained or contracted in consequence of the insured's being 24.16 under the influence of any narcotic unless administered on the 24.17 advice of a physician. 24.18 Subd. 3. [COVERAGE INCONSISTENT.] If any provision of this 24.19 section is in whole or in part inapplicable to or inconsistent 24.20 with the coverage provided by a particular form of policy the 24.21 insurer, with the approval of the commissioner, shall omit from 24.22 such policy any inapplicable provision or part of a provision, 24.23 and shall modify any inconsistent provision or part of the 24.24 provision in such manner as to make the provision as contained 24.25 in the policy consistent with the coverage provided by the 24.26 policy. 24.27 Subd. 4. [ORDER OF PROVISIONS.] The provisions which are 24.28 the subject of subdivisions 1 and 2, or any corresponding 24.29 provisions which are used in lieu thereof in accordance with 24.30 subdivisions 1 and 2, shall be printed in the consecutive order 24.31 of the provisions in subdivisions 1 and 2 or, at the option of 24.32 the insurer, any such provision may appear as a unit in any part 24.33 of the policy, with other provisions to which it may be 24.34 logically related, provided the resulting policy shall not be in 24.35 whole or in part unintelligible, uncertain, ambiguous, abstruse, 24.36 or likely to mislead a person to whom the policy is offered, 25.1 delivered, or issued.