NAC687B.0689. Rescission or denial of claim upon showing of misrepresentation material to acceptance for coverage; field issuance of contract or certificate.

     1. For a long-term care insurance contract or certificate that has been in force for less than 6 months, an insurer may rescind the long-term care insurance contract or certificate or deny an otherwise valid long-term care insurance claim upon a showing of misrepresentation that is material to the acceptance for coverage. 

     2. For a long-term care insurance contract or certificate that has been in force for not less than 6 months but less than 2 years, an insurer may rescind the long-term care insurance contract or certificate or deny an otherwise valid long-term care insurance claim upon a showing of misrepresentation which is both material to the acceptance for coverage and which pertains to the condition for which benefits are sought.

     3. After a long-term care insurance contract or certificate has been in force for 2 years, it is not contestable upon the grounds of misrepresentation alone and may be contested only upon a showing that the insured knowingly and intentionally misrepresented relevant facts relating to the insured’s health.

     4. A long-term care insurance contract or certificate may be field-issued if the compensation to the field issuer is not based on the number of long-term care insurance contracts or certificates issued.

     5. If an insurer has paid benefits under a long-term care insurance contract or certificate, the benefit payments must not be recovered by the insurer if the long-term care insurance contract or certificate is rescinded. 

     6. The provisions of this section apply to policies of life insurance which accelerate benefits for long-term care except that, in the event of the death of the insured, this section does not apply to the remaining death benefit of a policy of life insurance that accelerates benefits for long-term care, and the remaining death benefits under such a policy must be governed by NRS 688A.080.

     7. As used in this section, “field-issued” means issued by a producer or a third-party administrator pursuant to the underwriting authority granted to the producer or third-party administrator by an insurer, using the insurer’s underwriting guidelines.

     (Added to NAC by Comm’r of Insurance by R028-10, 12-16-2010, eff. 10-1-2011)