Or. Admin. R. 836-052-0556

Current through Register Vol. 63, No. 8, August 1, 2024

Section 836-052-0556 - Required Disclosure of Rating Practices to Consumers

(1) This rule applies as follows:

(a) Except as provided in subsection (b) of this section, this rule applies to any long term care policy or certificate issued in this state on or after March 1, 2006.

(b) For certificates issued on or after March 1, 2005 under a group long-term care insurance policy as defined in ORS 743.652(3)(a), which policy was in force on March 1, 2005, the provisions of this rule shall apply on the policy anniversary following March 1, 2006.

(2) Other than policies for which no applicable premium rate or rate schedule increases can be made, an insurer shall provide all of the information listed in this section to the applicant at the time of application or enrollment, unless the method of application does not allow for delivery at that time. In such a case, the insurer shall provide all of the information listed in this rule to the applicant not later than at the time of delivery of the policy or certificate. The information is as follows:

(a) A statement that the policy may be subject to rate increases in the future;

(b) An explanation of potential future premium rate revisions and the policyholder's or certificate holder's option 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 premium rate or rate schedule adjustments, which shall include:

(A) A description of when premium rate or rate schedule adjustments will be effective (e.g. next anniversary date, next billing date, etc.); and

(B) The right to a revised premium rate or rate schedule as provided in subsection (c) of this section if the premium rate or rate schedule is changed.

(e)

(A) Information regarding each premium rate increase on this policy form or similar policy forms over the past ten years for this state or any other state that at a minimum identifies

(i) The policy forms for which premium rates have been increased.

(ii) The calendar years when the form was available for purchase; and

(iii) The amount or percent of each increase. The percentage may be expressed as a percentage of the premium rate prior to the increase and may also be expressed as minimum and maximum percentages if the rate increase is variable by rating characteristics.

(B) The insurer may provide additional explanatory information related to the rate increases.

(C) An insurer shall have the right to exclude from the disclosure premium rate increases that apply only to blocks of business acquired from other nonaffiliated insurers or the long term care policies acquired from other nonaffiliated insurers when those increases occurred prior to the acquisition.

(D) If an acquiring insurer files for a rate increase on a long term care insurance policy form acquired from a nonaffiliated insurer or a block of policy forms acquired from a nonaffiliated insurer on or before the later of the effective date of this rule or the end of a 24-month period following the acquisition of the block or policies, the acquiring insurer may exclude that rate increase from the disclosure. The nonaffiliated selling insurer shall include the disclosure of that rate increase in accordance with paragraph (A) of this subsection.

(E) If the acquiring insurer in paragraph (D) of this subsection files for a subsequent rate increase whether within the 24-month period or later, the acquiring insurer must make all disclosures required by this section, on the same policy form acquired from nonaffiliated insurer or block of policy forms acquired from nonaffiliated insurers referenced in paragraph (D) of this subsection, including disclosure of the earlier rate increase referenced in paragraph (A) of this subsection.

(3) An applicant shall sign an acknowledgement at the time of application, unless the method of application does not allow for signature at that time, that the insurer made the disclosure required under subsection (2)(a) and (e) of this section. If owing to the method of application the applicant cannot sign an acknowledgement at the time of application, the applicant shall sign an acknowledgement no later than at the time of delivery of the policy or certificate.

(4) An insurer shall use the forms in Exhibits 1 and 2 to comply with sections (2) and (3) of this rule.

(5) An insurer shall provide notice of an upcoming premium rate schedule increase to all policyholders or certificate holders, if applicable, at least 45 days prior to the implementation of the premium rate schedule increase by the insurer. The notice shall include the information required by section (2) of this rule when the rate increase is implemented.

Or. Admin. R. 836-052-0556

ID 3-2005, f. & cert. ef. 3-1-05; ID 10-2007, f. 12-3-07, cert. ef. 1-1-08

Exhibits referenced are available from the agency.

Stat. Auth.: ORS 731.244, 742.023, 743.013, 743.655, 743.656 & 746.240

Stats. Implemented: ORS 731.244, 742.003, 742.005, 742.009, 743.010(3), 743.013(3), 743.650, 743.653, 743.655, 743.656 & 746.240