2006 Minnesota Statutes

62S.24 REQUIREMENTS FOR APPLICATION FORMS AND REPLACEMENT
COVERAGE.
    Subdivision 1. Required questions. An application form must include the following
questions designed to elicit information as to whether, as of the date of the application, the
applicant has another long-term care insurance policy or certificate in force or whether a long-term
care policy or certificate is intended to replace any other accident and sickness or long-term care
policy or certificate presently in force. A supplementary application or other form to be signed
by the applicant and agent, except where the coverage is sold without an agent, containing the
following questions may be used. If a replacement policy is issued to a group as defined under
section 62S.01, subdivision 15, clause (1), the following questions may be modified only to the
extent necessary to elicit information about long-term care insurance policies other than the
group policy being replaced; provided, however, that the certificate holder has been notified
of the replacement:
(1) do you have another long-term care insurance policy or certificate in force (including
health care service contract or health maintenance organization contract)?;
(2) did you have another long-term care insurance policy or certificate in force during the
last 12 months?;
(i) if so, with which company?; and
(ii) if that policy lapsed, when did it lapse?;
(3) are you covered by Medicaid?; and
(4) do you intend to replace any of your medical or health insurance coverage with this
policy (certificate)?
    Subd. 1a. Other health insurance policies sold by agent. Agents shall list all other health
insurance policies they have sold to the applicant that are still in force or were sold in the past
five years and are no longer in force.
    Subd. 2. Additional application requirements. An application for a long-term care
insurance policy or certificate must meet the requirements specified under section 62S.21.
    Subd. 3. Solicitations other than direct response. After determining that a sale will involve
replacement, an insurer, other than an insurer using direct response solicitation methods or its
agent, shall furnish the applicant, before issuance or delivery of the individual long-term care
insurance policy, a notice regarding replacement of accident and sickness or long-term care
coverage. One copy of the notice must be retained by the applicant and an additional copy
signed by the applicant must be retained by the insurer. The required notice must be provided in
the following manner:

NOTICE TO APPLICANT REGARDING REPLACEMENT OF

INDIVIDUAL ACCIDENT AND SICKNESS OR LONG-TERM CARE INSURANCE

(Insurance company's name and address)

SAVE THIS NOTICE! IT MAY BE IMPORTANT TO YOU IN THE FUTURE.

According to (your application) (information you have furnished), you intend to lapse or
otherwise terminate existing accident and sickness or long-term care insurance and replace it
with an individual long-term care insurance policy to be issued by (company name) insurance
company. Your new policy provides 30 days within which you may decide, without cost, whether
you desire to keep the policy. For your own information and protection, you should be aware of
and seriously consider certain factors which may affect the insurance protection available to
you under the new policy.
You should review this new coverage carefully, comparing it with all accident and sickness
or long-term care insurance coverage you now have, and terminate your present policy only if,
after due consideration, you find that purchase of this long-term care coverage is a wise decision.

STATEMENT TO APPLICANT BY AGENT

(BROKER OR OTHER REPRESENTATIVE):
(Use additional sheets, as necessary.)
I have reviewed your current medical health insurance coverage. I believe the replacement of
insurance involved in this transaction materially improves your position. My conclusion has taken
into account the following considerations, which I call to your attention:
(a) Health conditions which you presently have (preexisting conditions) may not be
immediately or fully covered under the new policy. This could result in denial or delay in payment
of benefits under the new policy, whereas a similar claim might have been payable under your
present policy.
(b) State law provides that your replacement policy or certificate may not contain new
preexisting conditions or probationary periods. The insurer will waive any time periods applicable
to preexisting conditions or probationary periods in the new policy (or coverage) for similar
benefits to the extent such time was spent (depleted) under the original policy.
(c) If you are replacing existing accident and sickness or long-term care insurance coverage,
you may wish to secure the advice of your present insurer or its agent regarding the proposed
replacement of your present policy. This is not only your right, but it is also in your best interest to
make sure you understand all the relevant factors involved in replacing your present coverage.
(d) If, after due consideration, you still wish to terminate your present policy and replace it
with new coverage, be certain to truthfully and completely answer all questions on the application
concerning your medical health history. Failure to include all material medical information on
an application may provide a basis for the company to deny any future claims and to refund
your premium as though your policy had never been in force. After the application has been
completed and before you sign it, reread it carefully to be certain that all information has been
properly recorded.

	(Signature of Agent, Broker, or Other Representative)
	(Typed Name and Address of Agency or Broker)
	The above "Notice to Applicant" was delivered to me on:

		(Date)
		(Applicant's Signature)

    Subd. 4. Direct response solicitations. Insurers using direct response solicitation methods
shall deliver a notice regarding replacement of long-term care coverage to the applicant upon
issuance of the policy. The required notice must be provided in the following manner:

NOTICE TO APPLICANT REGARDING REPLACEMENT OF ACCIDENT

AND SICKNESS OR LONG-TERM CARE INSURANCE

(Insurance company's name and address)

SAVE THIS NOTICE! IT MAY BE

IMPORTANT TO YOU IN THE FUTURE.
According to (your application) (information you have furnished), you intend to lapse or
otherwise terminate existing accident and sickness or long-term care insurance and replace it with
the long-term care insurance policy delivered herewith issued by (company name) insurance
company.
Your new policy provides 30 days within which you may decide, without cost, whether you
desire to keep the policy. For your own information and protection, you should be aware of
and seriously consider certain factors which may affect the insurance protection available to
you under the new policy.
You should review this new coverage carefully, comparing it with all long-term care
insurance coverage you now have, and terminate your present policy only if, after due
consideration, you find that purchase of this long-term care coverage is a wise decision.
(a) Health conditions which you presently have (preexisting conditions) may not be
immediately or fully covered under the new policy. This could result in denial or delay in payment
of benefits under the new policy, whereas a similar claim might have been payable under your
present policy.
(b) State law provides that your replacement policy or certificate may not contain new
preexisting conditions or probationary periods. Your insurer will waive any time periods
applicable to preexisting conditions or probationary periods in the new policy (or coverage) for
similar benefits to the extent such time was spent (depleted) under the original policy.
(c) If you are replacing existing accident and sickness or long-term care insurance coverage,
you may wish to secure the advice of your present insurer or its agent regarding the proposed
replacement of your present policy. This is not only your right, but it is also in your best interest to
make sure you understand all the relevant factors involved in replacing your present coverage.
(d) (To be included only if the application is attached to the policy.)
If, after due consideration, you still wish to terminate your present policy and replace it with
new coverage, read the copy of the application attached to your new policy and be sure that
all questions are answered fully and correctly. Omissions or misstatements in the application
could cause an otherwise valid claim to be denied. Carefully check the application and write to
(company name and address) within 30 days if any information is not correct and complete, or if
any past medical history has been left out of the application.

		(Company Name)

    Subd. 5. Replacement notification. Where replacement is intended, the replacing insurer
shall notify, in writing, the existing insurer of the proposed replacement. The existing policy must
be identified by the insurer, name of the insured, and policy number or address including zip code.
The notice must be made within five working days from the date the application is received by the
insurer or the date the policy is issued, whichever is sooner.
    Subd. 6. Waiver of preexisting condition and probationary periods. If a long-term care
insurance policy or certificate replaces another long-term care policy or certificate, the replacing
insurer shall waive any time periods applicable to preexisting conditions and probationary periods
in the new long-term care policy for similar benefits to the extent that similar exclusions have
been satisfied under the original policy.
    Subd. 7. Life insurance policies. Life insurance policies that accelerate benefits for
long-term care shall comply with this section if the policy being replaced is a long-term care
insurance policy. If the policy being replaced is a life insurance policy, the insurer shall comply
with the replacement requirements of sections 61A.53 to 61A.60. If a life insurance policy that
accelerates benefits for long-term care is replaced by another such policy, the replacing insurer
shall comply with both the long-term care and the life insurance replacement requirements.
    Subd. 8. Exchange for long-term care partnership policy; addition of policy rider. (a)
If authorized by federal law or a federal waiver is granted with respect to the long-term care
partnership program referenced in section 256B.0571, issuers of long-term care policies may
voluntarily exchange a current long-term care insurance policy for a long-term care partnership
policy that meets the requirements of Public Law 109-171, section 6021, after the effective date
of the state plan amendment implementing the partnership program in this state.
(b) If authorized by federal law or a federal waiver is granted with respect to the long-term
care partnership program referenced in section 256B.0571, allowing an existing long-term care
insurance policy to qualify as a partnership policy by addition of a policy rider, the issuer of
the policy is authorized to add the rider to the policy after the effective date of the state plan
amendment implementing the partnership program in this state.
(c) The commissioner, in cooperation with the commissioner of human services, shall
pursue any federal law changes or waivers necessary to allow the implementation of paragraphs
(a) and (b).
History: 1997 c 71 art 1 s 24; 2006 c 255 s 44-49; 2006 c 282 art 17 s 10-15