Life and Health News September 2012

The following is a brief review of selected items that may be of current interest to First Consulting & Administration, Inc. clients and friends.  Please feel free to copy it for distribution to your staff.  Contact us for more details about any item.  We welcome your comments and suggestions on this letter.  Please call our office.

South Dakota issued a bulletin regarding annuity contracts that provide access to benefit guarantees or values based on long-term care type triggers such as nursing home confinement and home care.     Bulletin 12-04

Puerto Rico issued a ruling letter to remind insurers that they have a 90-day period to adjust, investigate, and resolve claims. If the insurer can not resolve the claim within this time period, the insurer should conserve documents showing just cause in the case record. The ruling letter explains what the Commissioner's Office considers to be just cause.     Ruling Letter 2012-145-D

California issued a notice regarding corporate applications and similar filings requesting department approval by year-end 2012.  The notice provides due dates for submission of such applications, describes characteristics of a perfected application, and advises that applications for a certificate of authority or an organizational permit will not be eligible for year-end completion in most cases.     Notice of Year-End Review Procedure

Maryland notified insurers of new Life and Health Insurance Guaranty Corporation notice requirements.     Bulletin 12-13

New York increased the life guaranty association assessment cap from $500 million to $558 million.     Senate Bill 6507

California adopted regulations to prevent discrimination in health insurance coverage and health insurance claims approval based upon an individual’s actual or perceived gender identity.     Regulation 2561.1+

Colorado issued a bulletin regarding health insurance filings containing a provision for deductible credits, deductible refunds or a similar provision under a different title.     Bulletin No. B-4.46

Massachusetts enacted legislation to provide that health insurance provide specified coverage for hearing aids for any child, 21 years old or younger.     House Bill 52

New York amended laws pertaining to coverage that provides annual physicals and well care visits once in every 365 days to state that such policies will be interpreted to mean that such physical or well care visit can be had once every calendar year, whether or not 365 days have passed since the previous physical or well care visit.     Assembly Bill 397

New York revised the requirement that coverage be provided for breast reconstruction surgery following a mastectomy to also require that reconstruction surgery be provided after a partial mastectomy.     Senate Bill 3801

Washington designated which services must be included as essential health benefits in all non-grandfathered individual and small group plans that are offered, issued, renewed or amended on or after 1-1-14.      284-43-865

Oregon adopted changes concerning consumer disclosure requirements for individual and small employer health benefit plan rate filings.     OAR 836-053-0471

The IIPRC distributed an email on 8-7-2012 about updating IIPRC-approved applications to revise the MIB authorization language.  Companies can make the changes MIB member insurers are being asked to make to IIPRC-approved forms without incurring additional IIPRC filing fees.  State fees will still apply for some states.     IIPRC Notice: Update to MIB Statement on IIPRC Approved Application Forms

The IIPRC issued an email on 8-13-2012 providing tips for the submission of disability income filings to the Interstate Compact.     IIPRC Weekly Tip -Disability Income Products

Wisconsin amended rules pertaining to the Bureau of Financial Analysis and Examinations and the Bureau of Market Regulation adding references to life settlements related forms.     Rule ADC Ins. Chapter 7

South Dakota established requirements for the use of a contractor to complete long-term care insurance replacement application questions.     Rule 20:06:21:28.01

Hawaii amended regulations to extend statement of actuarial opinion filing requirements to accident and health or sickness insurers.     16-169-16 and 16-169-17

Massachusetts enacted legislation concerning policyholder notice requirements when an insurer within the same group of insurers issues a succeeding policy.   Notice is not required if such an insurer issues a succeeding policy that provides coverage on the same terms and conditions as the preceding policy.  The insured must be notified in writing of any changes in coverage from the preceding policy.     House Bill 3791, 175:113, 175:193P

Colorado amended a regulation concerning enterprise zones credit against premium tax and added sections on applicability, filing requirements, enforcement and severability.     3 CO ADC INS 3-1-5

New York adopted an Emergency Regulation amending provisions on empire zones, including sections on empire zone tax credits.     Emergency Regulation 5 NYCRR 10+

New York amended its law to prohibit private businesses from requiring individuals to disclose their social security number. Certain exemptions are provided including use consented to by the individual and use expressly required under federal or state law.     Assembly Bill 8992

South Carolina published a bulletin instructing insurers not to reduce agent compensation for Medicare Supplement (Medigap) policies sold during open enrollment and guaranteed-issue periods.     BULLETIN NUMBER 2012-06

Arkansas issued a bulletin regarding compensation fee arrangements for insurance producers selling or servicing health insurance.     Bulletin 6-2012

Washington adopted changes to separate account requirements to make clear that the separate premium account may not be used as a personal asset by licensed producers and surplus line brokers, and that premium taxes must be deposited into the account and cannot be withdrawn from the account, except for payment to the state or refund of unearned taxes.     284-12-080

New York amended provisions pertaining to anti-rebating. The description of acceptable valuable consideration is revised to include merchandise or periodical subscriptions not exceeding $25 in value.     Assembly Bill 9702

Delaware amended its Code to conform to provisions of the NAIC Credit for Reinsurance Model Act.     House Bill 346

New York made several changes to telemarketing statutes.  Included is a provision prohibiting prerecorded telemarketing messages if the recipient has not expressly consented to receive such calls.     Assembly Bill 10569

Michigan amended the Unclaimed Property Act by modifying the look-back period to 5 years.     House Bill 5577

New York adopted an Emergency Regulation regarding unclaimed property. Among other things, the rule requires the insurer to notify the beneficiary within 30 days of the notification of all items necessary to file a claim if the insurer determines that there are benefits to be paid or other monies to be distributed.     Emergency Regulation 200 (11 NYCRR 226)

Illinois issued a bulletin outlining requirements for the continued use of existing policy forms that must be modified due to the decrease in the maximum valuation interest rates for 2013 life insurance issues.     Bulletin 2012-04

Colorado amended its viatical settlements regulation.  Changes include the addition of sections on applicability and license requirements and an updated definitions section.      3 CO ADC INS 2-1-11

Your Product Drafting Resource

Insurers work hard to keep their products relevant and in compliance.  Changes in the laws, shifting consumer demands and new markets all require development of new products or revisions to existing ones. For over 40 years, First Consulting’s skilled staff has helped insurers with all of these drafting challenges.

First Consulting tailors its approach to your company’s drafting project based on your company’s specific needs.  We can help with your project, handling any or all of the following:

  • drafting generic product language
  • developing state variations in all or some states
  • revising existing contracts to add new benefits or features

Our staff consists of attorneys and insurance professionals with a wide range of industry designations and experience in all lines of business.

Visit First Consulting’s website and learn more.

Stacy Koron


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Your Company faces daily unique regulatory and compliance challenges. Don’t face them alone with in-house staff or give-up control to cookie-cutter outsourcing.

We work with your staff when you need us, in whatever manner best suits the needs of your Company, without being a fixed expense. We understand that each Company is unique. Many projects have quite different requirements. Through it all, however, your staff remains responsible for results and maintains control.


First Consulting recognizes that your Company’s unique needs require unique solutions.

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