NAC687B.0585. Required disclosures regarding rate revisions.

     1. For any long-term care insurance contract or certificate issued in this State on or after October 1, 2008, other than a long-term care insurance contract or certificate for which no applicable increases in premium rates or rate schedules can be made, the insurer shall provide to the applicant:

     (a) A statement that the long-term care insurance contract or certificate may be subject to rate increases in the future;

     (b) An explanation of potential future premium rate revisions, and the options available to the applicant in the event of a premium rate revision;

     (c) The premium rate or rate schedules applicable to the applicant that will be in effect until a request is made for an increase;

     (d) A general explanation for applying adjustments to premium rates or rate schedules that must include:

          (1) A description of when such adjustments will be effective; and

          (2) A statement that the applicant must be provided with a revised premium rate or rate schedule if the premium rate or rate schedule is changed;

     (e) Except as otherwise provided in subsection 3, information relating to each increase in premium rates on the long-term care insurance contract form or similar long-term care insurance contract forms during the previous 10 years for this State or any other state, including, without limitation, information that identifies:

          (1) The long-term care insurance contract forms for which premium rates have increased;

          (2) The calendar years when the long-term care insurance contract form was available for purchase; and

          (3) The amount or percentage of each rate increase which may be expressed as a percentage of the premium rate before the increase or as minimum and maximum percentages if the rate increase is variable by rating characteristics; and

     (f) Any additional explanatory information related to rate increases that the insurer chooses to provide.

     2. In addition to the requirements of subsection 1, if an insurer or similar organization acquires a block of long-term care insurance contract forms from a nonaffiliated insurer or similar organization and:

     (a) The premium rates for the block of long-term care insurance contract forms increase within 24 months after the block of long-term care insurance contract forms is acquired, the nonaffiliated insurer or similar organization shall provide a statement of the increase in premium rates to the applicant; and

     (b) At any time after the acquisition the acquiring insurer files for a rate increase, subsequent to the rate increase described in paragraph (a), on the block of long-term care insurance contract forms, the acquiring insurer shall make all disclosures required by paragraph (e) of subsection 1 and provide a statement of the increase in premium rates to the applicant.

     3. The provisions of paragraph (e) of subsection 1 do not apply to:

     (a) Any increase in premium rates for any block of long-term care insurance contract forms acquired by the insurer from a nonaffiliated insurer if the increases occurred before the acquisition or not later than 24 months after the acquisition; or

     (b) Any increase in premium rates for long-term care insurance contracts acquired by the insurer from a nonaffiliated insurer if the increases occurred before the acquisition or not later than 24 months after the acquisition.

     4. The insurer shall provide the information required by subsection 1 to the applicant:

     (a) At the time of application; or

     (b) If the method of application does not allow for delivery of the long-term care insurance contract or certificate at the time of application, not later than the time of delivery of the long-term care insurance contract or certificate.

     5. An applicant must sign an acknowledgment that the insurer provided the information required by subsection 1:

     (a) At the time of application; or

     (b) If the method of application does not allow for the signing of the acknowledgment at the time of application, not later than the time of delivery of the long-term care insurance contract or certificate.

     6. An insurer shall use forms NDOI-949 and NDOI-953, available from the Division, to comply with the requirements of this section.

     7. An insurer shall provide notice of any increase in a premium rate schedule to all affected policyholders or certificate holders not less than 60 days before the effective date of the increase. The notice must include, without limitation, the information required by subsection 1.

     (Added to NAC by Comm’r of Insurance by R121-07, 9-18-2008, eff. 10-1-2008; A by R028-10, 12-16-2010, eff. 10-1-2011)