Title 27
Insurance

Chapter 34.2
Long-Term Care Insurance

§ 27-34.2-4. Definitions.

Unless the context requires otherwise, the following definitions apply throughout the chapter:

(1) “Applicant” means:

(i) In the case of an individual long-term care insurance policy, the person who seeks to contract for benefits; and

(ii) In the case of a group long-term care insurance policy, the proposed certificate holder.

(2) “Certificate” means, for the purposes of this chapter, any certificate issued under a group long-term care insurance policy, which policy has been delivered or issued for delivery in this state, except as provided for in § 27-34.2-5.

(3) “Director” means the director of business regulation.

(4) “Group long-term care insurance” means a long-term care insurance policy that is delivered or issued for delivery in this state and issued to:

(i) One or more employers or labor organizations, or to a trust, or to the trustees of a fund established by one or more employers or labor organizations, or a combination of employers and labor organizations, for employees or former employees or a combination of employees and former employees, or for members or former members, or a combination of members and former members, of the labor organizations; or

(ii) Any professional, trade, or occupational association for its members or former or retired members, or combination of members and former members, if that association:

(A) Is composed of individuals all of whom are or were actively engaged in the same profession, trade, or occupation; and

(B) Has been maintained in good faith for purposes other than obtaining insurance; or

(iii) An association, a trust, or the trustee(s) of a fund established, created, or maintained for the benefit of members of one or more associations. Prior to advertising, marketing, or offering that policy within this state, the association or associations, or the insurer of the association or associations, shall file evidence with the director that the association or associations have at the outset a minimum of one hundred (100) persons and have been organized and maintained in good faith for purposes other than that of obtaining insurance, have been in active existence for at least one year, and have a constitution and bylaws which provide that:

(A) The association or associations hold regular meetings not less than annually to further purposes of the members;

(B) Except for credit unions, the association or associations collect dues or solicit contributions from members; and

(C) The members have voting privileges and representation on the governing board and committees;

(iv) Thirty (30) days after that filing the association or associations will be deemed to satisfy those organizational requirements, unless the director makes a finding that the association or associations do not satisfy those organizational requirements; or

(v) A group other than as described in subsections (4)(i), (4)(ii), and (4)(iii) of this section, subject to a finding by the director that:

(A) The issuance of the group policy is not contrary to the best interest of the public;

(B) The issuance of the group policy would result in economies of acquisition or administration; and

(C) The benefits are reasonable in relation to the premiums charged.

(5) “Issuer” means any domestic or foreign insurance company as defined in this title or any other entity legally authorized to issue or deliver long-term care insurance contracts pursuant to the provisions of this chapter.

(6)(i) “Long-term care insurance” means any insurance policy or rider advertised, marketed, offered, or designed to provide coverage for not less than twelve (12) consecutive months for each covered person on an expense incurred, indemnity, prepaid, or other basis, for one or more necessary or medically necessary diagnostic, preventive, therapeutic, rehabilitative, maintenance, or personal care services provided in a setting other than an acute care unit of a hospital. This term includes group and individual annuities and life insurance policies or riders that provide directly or that supplement long-term care insurance. This term also includes a policy or rider that provides for payment of benefits based upon cognitive impairment or the loss of functional capacity. Long-term care insurance may be issued by insurers, fraternal benefit societies, nonprofit health, hospital, and medical service corporations, prepaid health plans, health maintenance organizations, or any similar organization to the extent that they are authorized to issue life or health insurance. Long-term care insurance shall not include any insurance policy that was offered primarily to provide basic Medicare supplement coverage, basic hospital expense coverage, basic medical-surgical expense coverage, hospital confinement indemnity coverage, major medical expense coverage, disability income protection coverage, accident only coverage, specified disease or specified accident coverage, or limited benefit health coverage. This list of excluded coverages is illustrative and is not intended to be all-inclusive.

(ii) With regard to life insurance, this term does not include life insurance policies that accelerate the death benefit specifically for one or more of the qualifying events of terminal illness, medical conditions requiring extraordinary medical intervention, or permanent institutional confinement, and that provide the option of a lump sum payment for those benefits and in which neither the benefits nor the eligibility for the benefits is conditioned upon the receipt of long-term care. Notwithstanding any other provision contained in this chapter, any product advertised, marketed, or offered as long-term care insurance shall be subject to the provisions of this chapter.

(7) “Policy” means, for the purposes of this chapter, any policy, contract, subscriber agreement, rider, or endorsement delivered or issued for delivery in this state by an insurer, fraternal benefit society, nonprofit health, hospital, or medical service corporation, prepaid health plan, health maintenance organization, or any similar organization.

(8)(i) “Qualified long-term care insurance contract” or “federally tax-qualified long-term care insurance contract” means an individual or group insurance contract that meets the requirements of 26 U.S.C. § 7702B(b), as amended, et seq., as follows:

(A) The only insurance protection provided under the contract is coverage of qualified long-term care services. A contract shall not fail to satisfy the requirements of this subsection (8)(i)(A) by reason of payments being made on a per diem or other periodic basis without regard to the expenses incurred during the period to which the payments relate;

(B) The contract does not pay or reimburse expenses incurred for services or items to the extent that the expenses are reimbursable under Title XVIII of the Social Security Act (Medicare), as amended, 42 U.S.C. § 1395 et seq., or would be so reimbursable but for the application of a deductible or coinsurance amount. The requirements of this subsection (8)(i)(B) do not apply to expenses that are reimbursable under Title XVIII of the Social Security Act only as a secondary payor. A contract shall not fail to satisfy the requirements of this subsection (8)(i)(B) by reason of payments being made on a per diem or other periodic basis without regard to the expenses incurred during the period to which the payments relate;

(C) The contract is guaranteed renewable, within the meaning of 26 U.S.C. § 7702B(b)(1)(C), as amended, et seq.;

(D) The contract does not provide for a cash surrender value or other money that can be paid, assigned, pledged as collateral for a loan, or borrowed except as provided in subsection (8)(i)(E) of this section;

(E) All refunds of premiums, and all policyholder dividends or similar amounts, under the contract are to be applied as a reduction in future premiums or to increase future benefits, except that a refund on the event of death of the insured or a complete surrender or cancellation of the contract cannot exceed the aggregate premiums paid under the contract; and

(F) The contract meets the consumer protection provisions set forth in 26 U.S.C. § 7702B(g), as amended, et seq.;

(ii) “Qualified long-term care insurance contract” or “federally tax-qualified long-term care insurance contract” also means the portion of a life insurance contract that provides long-term care insurance coverage by rider or as part of the contract and that satisfied the requirements of 26 U.S.C. § 7702B(b) and (e), as amended, et seq.