Insurance Code — Part 4 | INS — United States — California law | Esheria

Insurance Code

Part 4 of 23 · provisions 601–800

This section says the act is known as the Insurance Code.

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About this statute

This section defines “underwriters’ corps” for this chapter. This chapter must not impair or interfere with the powers or duties of a municipality’s regular fire department. An owner of property cannot treat an underwriters’ corps act as a justification for abandoning the property. Certain domestic insurance-underwriter corporations may maintain an underwriter’s corps at their own expense if they meet the stated fire-prevention and local-business conditions. An underwriter’s corps may enter certain burning or fire-exposed buildings and may remove or protect property from fire or water damage while a fire is happening and immediately after.

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Provisions of Insurance Code

Showing 200 of 4,461

  1. 10199.6.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1.5. Health Coverage Contract Notification [10199 - 10199.9] ( Chapter 1.5 added by Stats. 1990, Ch. 949, Sec. 2. ) ## ARTICLE 3. Administration and Enforcement [10199.5 - 10199.9] ( Article 3 added by Stats. 1990, Ch. 949, Sec. 2. )

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    The commissioner can assess penalties for violations of this chapter and can suspend or revoke certain licenses after notice and hearing.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1.5. Health Coverage Contract Notification [10199 - 10199.9] ( Chapter 1.5 added by Stats. 1990, Ch. 949, Sec. 2. ) ## ARTICLE 3. Administration and Enforcement [10199.5 - 10199.9] ( Article 3 added by Stats. 1990, Ch. 949, Sec. 2. ) ## 10199.6. (a) The commissioner shall have the administrative authority to assess penalties against insurers, nonprofit hospital service plans, administrators, and insurance producers, and other entities engaged in the business of insurance or other persons or entities for violations of this chapter. (b) Upon a showing of a violation of this chapter in any civil action, a court may also assess the penalties described in this chapter. (c) The commissioner may suspend or revoke the license or licenses issued to any production agent or administrator found, after notice and hearing, to have violated this chapter or a regulation adopted pursuant to the authority of this chapter. Notice of hearing shall be accomplished and a hearing conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code, and the commissioner shall have all of the powers granted therein. (Added by Stats. 1990, Ch. 949, Sec. 2.)
  2. 10199.7.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1.5. Health Coverage Contract Notification [10199 - 10199.9] ( Chapter 1.5 added by Stats. 1990, Ch. 949, Sec. 2. ) ## ARTICLE 3. Administration and Enforcement [10199.5 - 10199.9] ( Article 3 added by Stats. 1990, Ch. 949, Sec. 2. )

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    This section sets administrative penalties for insurance-related actors who violate the chapter, with higher penalties for repeat, knowing, or business-practice violations.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1.5. Health Coverage Contract Notification [10199 - 10199.9] ( Chapter 1.5 added by Stats. 1990, Ch. 949, Sec. 2. ) ## ARTICLE 3. Administration and Enforcement [10199.5 - 10199.9] ( Article 3 added by Stats. 1990, Ch. 949, Sec. 2. ) ## 10199.7. (a) Any production agent, administrator, or other person or entity engaged in the business of insurance, other than an insurer, who violates this chapter is liable for administrative penalties of not less than two hundred fifty dollars ($250) for the first violation. (b) Any production agent, administrator, or other person or other entity engaged in the business of insurance, other than an insurer, who engages in practices prohibited by this chapter a second or subsequent time, or who commits a knowing violation of this chapter, is liable for administrative penalties of not less than one thousand dollars ($1,000) and not more than two thousand five hundred dollars ($2,500) for each violation. (c) Any insurer who violates this chapter is liable for administrative penalties of not less than two thousand five hundred dollars ($2,500) for the first violation. (d) Any insurer who violates this chapter with a frequency that indicates a general business practice, or commits a knowing violation of this chapter, is liable for administrative penalties of not less than ten thousand dollars ($10,000) and not more than one hundred thousand dollars ($100,000) for each violation. (Added by Stats. 1990, Ch. 949, Sec. 2.)
  3. 10199.8.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1.5. Health Coverage Contract Notification [10199 - 10199.9] ( Chapter 1.5 added by Stats. 1990, Ch. 949, Sec. 2. ) ## ARTICLE 3. Administration and Enforcement [10199.5 - 10199.9] ( Article 3 added by Stats. 1990, Ch. 949, Sec. 2. )

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    If an insurer violates this chapter or related regulations, or knowingly lets someone else do so, the commissioner may suspend the insurer’s certificate of authority to transact disability insurance after notice and hearing.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1.5. Health Coverage Contract Notification [10199 - 10199.9] ( Chapter 1.5 added by Stats. 1990, Ch. 949, Sec. 2. ) ## ARTICLE 3. Administration and Enforcement [10199.5 - 10199.9] ( Article 3 added by Stats. 1990, Ch. 949, Sec. 2. ) ## 10199.8. In addition to any other penalty provided by law or the availability of any administrative procedure, if an insurer, after notice and hearing, is found to have violated this chapter, or regulations adopted pursuant to this chapter, or knowingly permits any person to do so, the commissioner, in accordance with the procedures provided in Section 704, may suspend the insurer’s certificate of authority to transact disability insurance. Section 740.7 shall apply in any proceeding conducted pursuant to this section. (Added by Stats. 1990, Ch. 949, Sec. 2.)
  4. 10199.9.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1.5. Health Coverage Contract Notification [10199 - 10199.9] ( Chapter 1.5 added by Stats. 1990, Ch. 949, Sec. 2. ) ## ARTICLE 3. Administration and Enforcement [10199.5 - 10199.9] ( Article 3 added by Stats. 1990, Ch. 949, Sec. 2. )

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    This chapter applies to certain master group insurance and nonprofit hospital service plan contracts that provide hospital, medical, or surgical benefits when the coverage is solicited in California.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1.5. Health Coverage Contract Notification [10199 - 10199.9] ( Chapter 1.5 added by Stats. 1990, Ch. 949, Sec. 2. ) ## ARTICLE 3. Administration and Enforcement [10199.5 - 10199.9] ( Article 3 added by Stats. 1990, Ch. 949, Sec. 2. ) ## 10199.9. This chapter applies to all master group policies and master group nonprofit hospital service plan contracts providing hospital, medical, or surgical benefits, regardless of policy or contract situs, coverage under which is solicited in any manner in this state. (Added by Stats. 1990, Ch. 949, Sec. 2.)
  5. 102.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 1. THE CONTRACT [100 - 679.75] ( Part 1 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. Classes of Insurance [100 - 124.5] ( Chapter 1 enacted by Stats. 1935, Ch. 145. )

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    This section defines “fire insurance” to include certain fire and property-loss coverages, with specific exclusions.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 1. THE CONTRACT [100 - 679.75] ( Part 1 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. Classes of Insurance [100 - 124.5] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## 102. Fire insurance includes: (a) Insurance against loss by fire, lightning, windstorm, tornado, or earthquake. (b) Insurance against loss of, or destruction of, or damage to, any of the following property, when such insurance includes loss thereof by fire and excludes coverage of property while in the custody of, or possession of, or being transported by, any carrier for hire or in the mail: 1. Accounts, books, maps, manuscripts, indexes and other valuable papers, documents and records incidental to the business or profession or activity in which the insured is engaged, resulting from any cause, but excluding any article constituting stock in trade or used as a sample or sold or held for sale. 2. Moneys, stamps, coins, bullion, securities, notes, drafts, acceptances or instruments of like kind or character, resulting from any cause, except: (i) Forgery. (ii) Any dishonest, fraudulent or criminal act of any officer, employee, partner, director, trustee or authorized representative of the insured. (c) Insurance by means of an all-risk policy of the type commonly known as the “Personal Property Floater” against any and all kinds of loss of or damage to, or loss of use of, any personal property other than merchandise. The provisions of Section 2070 shall not apply to insurance written pursuant to subdivisions (b) or (c). (Amended by Stats. 1947, Ch. 630.)
  6. 1020.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. )

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    After certain insurance insolvency orders, the court must issue further injunctions or orders to stop listed harmful actions, and it may later modify, dissolve, or rescind those orders on motion by specified parties.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. ) ## 1020. Upon the issuance of an order either under Section 1011 or 1016, or at any time thereafter, the court shall issue such other injunctions or orders as may be deemed necessary to prevent any or all of the following occurrences: (a) Interference with the commissioner or the proceeding. (b) Waste of assets of such person. (c) The institution or prosecution of any actions or proceedings. (d) The obtaining of preferences, judgments, attachments, or other liens against such person or its assets. (e) The making of any levy against any such person or its assets. (f) The sale or deed for nonpayment of taxes or assessments levied by any taxing agency of property: (1) Owned by such person. (2) Upon which such person holds an encumbrance. (3) Upon which such person has prior thereto commenced an action to foreclose any deed of trust or mortgage or has exercised the power of sale under any trust deed or mortgage which sale or foreclosure proceedings have not yet been completed or upon which no trustee’s deed or judgment of court or sheriff’s certificate of sale has been issued. “Taxing agency” as used in this section has the meaning ascribed to it by Section 121 of the Revenue and Taxation Code. The injunctions or orders authorized by this subdivision may be modified, dissolved or rescinded by the court on motion of the commissioner, the State Controller, the person charged with the collection of taxes or assessments on such property, or any person beneficially interested in the property. The recording in the office of the county recorder of any county in the State of an order or injunction issued pursuant to this section, shall constitute service of such order or injunction upon any taxing agency with respect to property or interests therein located in such county. (g) Any managing general agent or attorney in fact from withholding from the commissioner any books, records, accounts, documents or other writing relating to the business of such person; provided, however, that, if by contract or otherwise any of the same are the property of such an agent or attorney, the same shall be returned when no longer necessary to the commissioner or at any time the court after notice and hearing shall so direct. (Amended by Stats. 1963, Ch. 1460.)
  7. 10200.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    Any life insurer may issue group life, disability, term, and endowment insurance, including annuities, and may use rates below or above usual rates in the situations described.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10200. Any life insurer may issue life, disability, term, and endowment insurance on the group plan, with or without annuities, and with premium rates less than the usual rates for such insurance. Such insurance under a franchise agreement or upon a wholesale basis may be written under rates more or less than the usual rates for such insurance. (Amended by Stats. 1961, Ch. 1385.)
  8. 10200.2.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    An insurer may, if the contracting parties choose, make a contract with a group policyholder or other contracting entity for group, selected group, or franchise policies to set retained premium amounts or establish reserves or deposits for future contingencies.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10200.2. An insurer may, in the discretion of the contracting parties, enter into a contract with a group policyholder or other contracting entity under any group, selected group, or franchise policy issued by the insurer to determine the amount the insurer may retain from premiums paid or to provide for the establishment of reserves or deposits to meet future contingencies of any nature under such insurance policy. Under this section, “contracting entity” means any of the following: (a) The employer, association, trustee, union, or other entity to whom a group policy is issued. (b) The organization to which an individual policyholder must belong or be associated with to be insured under a franchise or a selected group policy. (c) Any entity formed and operating for purposes other than the procuring of insurance to which two or more contracting entities defined in subdivision (a) or (b) of this section belong. (Added by Stats. 1967, Ch. 1194.)
  9. 10200.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    This section defines “franchise” or “wholesale” life insurance and limits when such plans may be entered into after the effective date.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10200.5. The term “franchise” or “wholesale” insurance shall mean a life insurance plan under which a number of individual life insurance policies are issued at special rates to a selected group. A special rate is any rate lower than the rate shown in the issuing insurance company’s manual for individually issued policies of the same type and to insureds of the same class. After the effective date of this section no franchise or wholesale life insurance plan shall be entered into in this State unless the individuals to whom such insurance is made available are members of a professional association, employees of a common employer or affiliated employers, or unless the insurance is made available in connection with an indebtedness or a contract of sale. The word “employees” as used in this section shall be deemed to include the individual proprietors or partners who constitute the employer or affiliated employers. In the case of any plan existing on or before the effective date of this section, any individual plan or policy then in effect shall not be changed or affected by this section, but no individual may thereafter become insured for more than twenty-five thousand dollars ($25,000), under any such plan except those written in connection with a professional association, an indebtedness, a contract of sale, or a pension plan. Nothing herein contained shall prevent any such plan so existing at the effective date hereof from being changed or modified (a) to change the insurer or insurers underwriting said plan and, to the extent necessary without affecting benefits payable, to make the plan conform to the underwriting rules and procedures of the new insurer or insurers; (b) to change rates applicable to insurance written under said plan; or (c) to add to said plan incidental benefits providing coverage on the lives of dependents of the insured individual, accidental death benefits or waiver of premiums during periods of total disability on the insured. For purposes of this section a professional association means an association whose membership is restricted to one or more of the licensed professions such as medicine, dentistry, pharmacy, law and accountancy. (Added by Stats. 1961, Ch. 718.)
  10. 10201.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    Group life insurance is limited to the forms listed in this chapter.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10201. The only forms of group life insurance are those set forth in this chapter. (Enacted by Stats. 1935, Ch. 145.)
  11. 10202.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    This section defines when life insurance counts as group life insurance and lists the required conditions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10202. Life insurance conforming to all the following conditions is one form of group life insurance: (a) Written under a policy covering when issued not less than two public or private employees. (b) Written under a policy issued to the employer, the premium on which is to be paid by the employer, by the employee, or by the employer and employees jointly, and insuring either all of the employees or all of any class or classes thereof, determined by conditions pertaining to the employment. (c) For amounts of insurance based upon some plan which will preclude individual selection. (d) For the benefit of persons other than the employer. That group insurance may be for the benefit of a trustee of a pension, welfare benefit plan, or trust established by an employer providing life, health, disability, retirement, or similar benefits to employees of the employer or its affiliates, and acting in a fiduciary capacity with respect to those employees, retired employees, or their dependents or beneficiaries, where the trustee has an insurable interest in the lives of the employees for whom those benefits are to be provided and where the employee has consented in writing to the coverage. (e) When the premium is to be paid by the employer and employee jointly and the benefits of the policy are offered to all eligible employees. (f) Terminating if, subsequent to issue, (1) the number of employees insured falls below two lives, and (2) the employee contributions, if the premiums for the insurance are on a renewable term insurance basis, exceed one dollar ($1) per month per one thousand dollars ($1,000) of insurance coverage plus an amount equal to any additional premium per one thousand dollars ($1,000) of insurance coverage charged to cover one or more hazardous occupations. (g) The application period and the notice requirements shall be the same for classes of former employees and retired employees as those set forth in paragraphs (2) and (4) of subdivision (a) of, and subdivision (b) of, Section 10209. That insurance may be issued either with or without medical examinations. (Amended by Stats. 2018, Ch. 425, Sec. 1. (AB 1373) Effective January 1, 2019.)
  12. 10202.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    A group life policy may define “employees” broadly, but it cannot insure people outside the listed eligible classes.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10202.5. (a) The term “employees” as used in Section 10202 may include the officers, managers, and employees of subsidiary or affiliated corporations, and the individual proprietors, partners, and employees of affiliated individuals and firms, when the business of such subsidiary or affiliated corporations, firms, or individuals is controlled by the policyholder through stock ownership, contract or otherwise, or when the policyholder is controlled by affiliated corporations, firms, or individuals through stock ownership, contract or otherwise. The policy may provide that the term “employees” as used in Section 10202 may include classes of former employees, including retired employees, and may also include the individual proprietors or partners who constitute the policyholder, but limited to such individual proprietors and partners who are actively engaged in the business the employees of which are covered by the group insurance. (b) This section does not permit any person other than an officer, manager, or employee for compensation, or classes of former employees, including retired employees, of the policyholder or of one or more of the individuals, firms, or corporations or of the individual proprietors or partners specified in subdivision (a) to become insured under a group policy. (Amended by Stats. 2019, Ch. 497, Sec. 179. (AB 991) Effective January 1, 2020.)
  13. 10202.8.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    A group life policy may be issued only if it meets the listed conditions, including coverage of at least 50 persons at issue date and no individual selection of insurance amounts.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10202.8. A group life policy conforming to all the following conditions may be issued to the trustees of a fund established by employer members of a trade association, or by a trade association maintained by contributions of such members for the sole benefit of their employees or, by one employer, or by two or more employers in the same industry, or by an association of employers in the same industry, or by one or more labor unions, or by one or more employers and one or more labor unions, or by an association of employers and one or more labor unions, to insure employees of the employers or members of the unions for the benefit of persons other than the employers or the unions: (a) The persons eligible for insurance shall be all of the employees of the employers or all of the members of the unions, or all of any class or classes thereof determined by conditions pertaining to their employment, or to membership in the unions, or to both. The policy may provide that the term “employees” may include classes of former employees, including retired employees, and the individual proprietor or partners if any employer is an individual proprietor or a partnership. A director of a corporate employer is not eligible for insurance under the policy unless that person is otherwise eligible as a bona fide employee of the corporation by performing services other than the usual duties of a director. An individual proprietor or partner is not eligible for insurance under the policy unless the proprietor or partner is actively engaged in and devotes a substantial part of their time to the conduct of the business of the proprietor or partnership. The policy may provide that the term “employees” shall include the trustees or their employees, or both, if their duties are principally connected with such trusteeship. (b) The premium for the policy shall be paid by the trustees either: (a) wholly from funds contributed by the employer or employers of the insured persons, or by the union or unions, or by both; or (b) partly from such funds and partly from funds contributed by either all of the insured persons or by one or more classes thereof, or (c) wholly derived funds contributed by the insured persons. (c) The policy must cover at the date of issue at least 50 persons. (d) The amounts of insurance under the policy must be based upon some plan precluding individual selection by the insured persons or by the trustees, employers, or unions. That insurance shall be issued with or without medical examination. For the purpose of this section the word “industry” shall include licensed professions, such as medicine, dentistry, pharmacy, law, and accountancy. (Amended by Stats. 2019, Ch. 497, Sec. 180. (AB 991) Effective January 1, 2020.)
  14. 10202.81.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    The State, political subdivisions, and municipalities may provide the insurance described in Section 10202.8 and may contribute to a fund under that section, on the same basis as a private employer.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10202.81. The State and any political subdivisions thereof and any municipality, may provide for the type of insurance set forth in Section 10202.8 of this code the same as any private employer and may contribute to a fund established under such section the same as any private employer. (Amended by Stats. 1957, Ch. 2255.)
  15. 10202.82.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    This section expands the meaning of “employees” and “employer” for Section 10202.8.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10202.82. The term “employees” as used in subdivision (a) of Section 10202.8 includes individual proprietors and partners of an employer which is an individual proprietor or partnership. The term “employer” as used in Section 10202.8 includes any self-employed member of a labor union whether or not there are persons employed by him. (Added by Stats. 1959, Ch. 2097.)
  16. 10202.85.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

    Verify source ↗

    A county-issued group life policy that conforms to Section 10202.8 may treat employees of a district located wholly or partly within the county as eligible, subject to Government Code Section 53200.4.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10202.85. A policy conforming to Section 10202.8 issued to a county may include as persons eligible, employees of a district located, wholly or partly, within such county. Such inclusion is subject to Section 53200.4 of the Government Code. (Added by Stats. 1968, Ch. 935.)
  17. 10203.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

    Verify source ↗

    This section says when life insurance counts as group life insurance and lists the required policy and membership conditions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10203. Life insurance conforming to all of the following conditions is another form of group life insurance: (a) Written under a policy covering, when issued, not less than 25 members of any of the following: (1) Any labor union or unions. (2) The National Guard. (3) Any association or governmental or public employees. (4) Any credit union organized and operating under the Federal Credit Union Act of 1934 or Chapter 36 of the California Statutes of 1927 as amended. (5) Any association of private employees of a common employer, formed for purposes other than obtaining insurance and having been in existence for two years or longer prior to issuance of the policy, and having a membership not less than 75 percent of the number of employees eligible for membership in such association. (b) Written under a policy issued to one or more such unions, credit union or association. (c) The premium on the policy to be paid by the union, credit union, or association or by the union or association and the members thereof jointly or by the insured members alone. Payment of such premium by a third party on behalf of the union member shall be considered payment by the union member. (d) Insuring only members of such union or unions or members of such credit union or association. (e) Insuring for amounts of insurance based upon some plan which will preclude individual selection. (f) Insuring for the benefit of persons other than the union, credit union or association or its officials. (g) Written under a policy insuring, when issued, not less than 75 percent of all members eligible for insurance under the policy, or 75 percent of such members of any class thereof reasonably determined by conditions pertaining to employment or of any established unit thereof not formed for the purpose of procuring insurance; provided, that if a group policy is intended to insure several such classes or units it may be issued as respects any such class or unit of which 75 percent are covered and extended to other such units or classes as 75 percent thereof express the desire to be covered. In such case, when members apply and pay for additional amounts of insurance, a smaller percentage of members may be insured for such additional amounts of insurance. If any member fails to become insured under an existing policy when he becomes eligible and later wishes to become insured thereunder, the insurer may require satisfactory evidence of insurability before insurance is granted on such member. (h) No policy of group life insurance shall be issued to an association of private employees of a common employer unless the employer consents in writing to deduct premiums from wages or salary of insured members. (i) Written under a policy covering any association having a constitution and bylaws and formed and continuously maintained in good faith for purposes other than that of obtaining insurance, offering insurance to all the eligible members of such association and covering not less than 25 such members or such members together with their dependents or spouses and not less than 75 percent of all eligible members for amounts of insurance based upon some plan which will preclude individual selection by the member as to the amount of his or her insurance coverage thereunder. If the master policy is to be issued to cover members of labor unions, it may be issued to more than one such union. (Amended by Stats. 1981, Ch. 735, Sec. 2.)
  18. 10203.1.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

    Verify source ↗

    Certain life insurance counts as group life insurance if it meets listed employee, premium, coverage, and beneficiary conditions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10203.1. Life insurance conforming to all the following conditions is another form of group life insurance: (a) Written under a policy covering, when issued, not less than 25 employees of the Trustees of the California State University in eligible classes as designated by the trustees pursuant to Section 89506 of the Education Code. (b) Written under a policy issued to the Trustees of the California State University pursuant to Section 89506 of the Education Code. (c) The premium on the policy is to be paid by the employees alone, or in part by the State of California, with the remainder to be paid by the employees. Payment of the premium by a third party on behalf of the employees shall be considered payment by the employees. (d) Insuring only the employees of the Trustees of the California State University. (e) Insuring for amounts of insurance based upon some plan which will preclude individual selection. (f) Insuring for the benefit of persons other than the Trustees of the California State University. (g) Written under a policy insuring, when issued, not less than 75 percent of all such employees eligible for insurance under the policy, or 75 percent of the employees of any class thereof reasonably determined by conditions pertaining to employment or of any established unit thereof not formed for the purpose of procuring insurance. However, if a group policy is intended to insure several classes or units, it may be issued as respects any class or unit, of which 75 percent are covered and extended to other units or classes as 75 percent thereof express the desire to be covered. In such case, when the employees apply and pay for additional amounts of insurance, a smaller percentage of employees may be insured for additional amounts of insurance. If any employee fails to become insured under an existing policy when he or she becomes eligible and later wishes to become insured thereunder, the insurer may require satisfactory evidence of insurability before insurance is granted on the employee. (Amended by Stats. 1983, Ch. 143, Sec. 200.)
  19. 10203.10.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

    Verify source ↗

    This section treats certain life insurance as group life insurance only if it meets listed conditions for coverage, eligibility, limits, reserves, filing, and approval.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10203.10. (a) Life insurance conforming to all of the following conditions is another form of group life insurance: (1) Written under a policy issued and delivered in connection with the payment of benefits against the risk of loss in the value of redeemable securities of the insured investor issued by an investment company or companies operating under the Investment Company Act of 1940, as amended, and whose redeemable securities are registered under the Securities Act of 1933, as amended. For the purposes of this section, such benefits shall be referred to as group investment return assurance. (2) Covering the lives of every eligible member of a group of persons who are or become investors in an investment company or companies. (3) The group numbers not less than 100 investors yearly. (4) The amount of insurance on any one investor does not exceed the amount of his investment, and does not exceed twenty thousand dollars ($20,000) on any one life. (5) The period of assurance for each investor shall not extend over a period exceeding the life of such investor. (6) The policy is issued upon the application of the investment company or companies, and the premiums are paid by the investment company, the investor, or jointly by the investment company and the investor. Such insurance may be issued with or without medical examination. (7) The policy provides a benefit equal to the difference between the amount paid for such redeemable securities and the value of such redeemable securities at the earlier of either (A) the end of the certificate period, or (B) the date of death of the insured. (8) To protect the public and policyholders located in this state from hazardous operation by domestic, foreign, or alien companies, and to further the purpose and provision of this part, no domestic, foreign, or alien insurance company shall undertake the issuance of any policy providing for group investment return assurance until such company has satisfied the commissioner that its condition or method of operation in connection with the issuance of such policies shall not be such as to render its operation hazardous to the public, or its policyholders in this state, and, whether domestic, foreign, or alien, that it meets the conditions prescribed in Section 717 for the issuance of a certificate of authority. In the determination of the qualification of a company requesting authority to issue policies providing for group investment return assurance within this state, the commissioner shall consider, in addition to the requirements of Section 717, all of the following: (A) the history of the company, (B) the character, responsibility, and general fitness of the officers and directors of the company, (C) the regulation of a foreign company by its state of domicile, (D) the adequacy of the investment management which the company is providing, and (E) the company’s arrangements for the supervision of the marketing of such policies. No company may provide group investment return assurance in its policies unless it is an admitted insurer having and maintaining a combined capital and surplus of at least two million dollars ($2,000,000). (9) In addition to the requirements of paragraph (8), no admitted insurer may provide group investment return assurance in its policies unless it establishes a special contingency fund of not less than one million dollars ($1,000,000). This fund shall be deemed to constitute a reserve liability in addition to other reserves of such insurer. In the event an insurer issues both group and individual investment return assurance, such special contingency fund shall not be less than one million dollars ($1,000,000) for both group and individual assurance. (b) The commissioner shall require the payment of two hundred fifty dollars ($250) as a fee for the determination of qualification required by this section. Upon completion of the determination of qualification, and whether authorization to issue policies providing group investment return benefits is granted or denied, the commissioner shall require the payment of such additional amounts from the requesting insurer as may be necessary to defray all administrative costs in excess of two hundred fifty dollars ($250) incurred by the commissioner in making such determination. (c) On and after the effective date of this section, a group investment return assurance policy, or certificate evidencing such insurance, shall not be issued or delivered in this state until a copy of the form thereof is filed with the commissioner, the fees required by Section 12973.9 are paid, and the commissioner has given written approval of such form. (d) No certificate of group investment return assurance shall be delivered or issued for delivery to any person in this state unless each such certificate does all of the following: (1) Includes a statement on the first page thereof, in boldface type, that in the event that the value of the redeemable securities covered by the contract exceeds the amount paid for such securities, there shall be no benefit. (2) Provides that the reserves for all group investment return assurance policies shall be computed and maintained on a basis which shall place an actuarially sound value on the liabilities under such policies. To provide a basis for the determination of such actuarially sound values, the commissioner, from time to time, shall adopt rules requiring the use of appropriate tables of morbidity, mortality, interest rates, and valuation methods for such reserves. (e) In furtherance of the purpose of this section, the commissioner may make reasonable rules and regulations therefor. Such rules and regulations shall be adopted, amended or repealed in accordance with the procedure provided in Chapter 4.5 (commencing with Section 11371) of Part 1 of Division 3 of Title 2 of the Government Code. (Added by Stats. 1971, Ch. 1565.)
  20. 10203.2.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

    Verify source ↗

    Life insurance counts as another form of group life insurance if it meets all listed policy conditions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10203.2. Life insurance conforming to all the following conditions is another form of group life insurance: (a) Written under a policy covering, when issued, not less than 25 employees in eligible classes or positions as designated by the Department of Human Resources pursuant to Section 19849.11 of the Government Code. (b) Written under a policy issued to the State of California through the Department of Human Resources or its designee pursuant to Sections 19849.10 to 19849.12, inclusive, of the Government Code. (c) The premium on the policy is to be paid by the employees alone, by the state alone, or in part by the state with the remainder to be paid by the employees. (d) Insuring only managerial and confidential employees as defined by subdivisions (e) and (f) of Section 3513 of the Government Code, and employees excluded from the definition of state employees in subdivision (c) of Section 3513 of the Government Code. (e) Insuring for amounts of insurance based upon some plan which will preclude individual selection. (f) Insuring for the benefit of persons other than the Department of Human Resources or its designee. (g) Written under a policy insuring, when issued, not less than 75 percent of all employees eligible for insurance under the policy, or 75 percent of the employees of any class or position thereof reasonably determined by conditions pertaining to employment or of any established unit thereof not formed for the purpose of procuring insurance. If a group policy is intended to insure several classes, positions, or units, it may be issued as respects the classes, positions, or units of which 75 percent are covered and extended to those other units, classes, or positions of which 75 percent express the desire to be covered. In this case, when the employees apply and pay for additional amounts of insurance, a smaller percentage of employees may be insured for the additional amounts of insurance. If any employee fails to become insured under an existing policy when he or she becomes eligible and later wishes to become insured thereunder, the insurer may require satisfactory evidence of insurability before insurance is granted on the employee. (Amended by Stats. 2012, Ch. 665, Sec. 172. (SB 1308) Effective January 1, 2013.)
  21. 10203.4.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    This section allows group life insurance to be extended to dependents, limits the coverage amount, defines who counts as a dependent, and lets the employer, employee, or both pay the dependent premiums.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10203.4. (a) Insurance under a group life insurance policy issued pursuant to Sections 10202, 10202.8, 10203, 10203.1, and 10203.7 may be extended to insure the dependents, or any class or classes thereof, of each insured employee who so elects, in amounts in accordance with some plan that precludes individual selection and that shall not be in excess of 100 percent of the insurance on the life of the insured employee. For dependent children over the age of majority, the group policyholder may elect coverage at age variations up to the limiting age. (b) “Dependent” includes the member’s spouse or a minor child, as well as a child older than the age of majority up to a maximum of 26 years of age, or any child over the age of majority who is both incapable of self-sustaining employment by reason of an intellectual disability or physical handicap and chiefly dependent upon the employee for support and maintenance if proof of the incapacity and dependency is furnished to the insurer by the employee within 31 days of the child’s attainment of the limiting age and subsequently as may be required by the insurer, but not more frequently than annually after the two-year period following the child’s attainment of the limiting age. (c) The premiums for the insurance on the dependents may be paid by the employer, the employee, or the employer and the employee jointly. (Amended by Stats. 2016, Ch. 440, Sec. 1. (AB 565) Effective January 1, 2017.)
  22. 10203.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    This section says certain life insurance arrangements count as group life insurance if they meet listed group size, coverage amount, repayment, and beneficiary/payment conditions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10203.5. (a) Life insurance conforming to all the following conditions is another form of group life insurance: (1) Covering one of the following groups: (A) All members are or become borrowers from one financial institution, including subsidiary or affiliated persons, under an agreement to repay the sum borrowed. (B) All members are or become purchasers of merchandise or other property, exclusive of securities, investment certificates, and bank deposits, under an agreement to pay the balance of the purchase price. (2) The group numbers not less than 100 new entrants yearly or, in the case of a credit union, not less than 50 borrowers yearly. (3) The amount insured on any one borrower or purchaser does not exceed: (A) The amount of the loan commitment in the case of an agricultural or horticultural loan commitment, as defined in Section 10203.55, repayable in one sum or in irregular installments within a period not in excess of 18 months from the initial date of the loan commitment. (B) In all other cases, the balance of the indebtedness to the financial institution or vendor. (4) The repayment or payment of purchase price is to be made under the agreement of loan or purchase in substantially equal installments over a period not exceeding 40 years, in installments that may vary according to the terms of a signed agreement, in payments or installments in accordance with the usual terms of the creditor in the case of an open-ended agreement to extend credit, a revolving loan, or revolving charge account, or in one sum or irregular installments within a period not in excess of 18 months from the initial date of the commitment on an agricultural or horticultural loan. (5) The policy is issued upon application of and made payable to the financial institution, vendor, or a creditor to whom the vendor may transfer title to the indebtedness, as beneficiary, and the premiums are paid by or through the financial institution, vendor, or creditor. (b) A policy of insurance conforming to this section is not subject to Section 10209 of this code or Section 704.100 of the Code of Civil Procedure. (Amended by Stats. 2006, Ch. 538, Sec. 467. Effective January 1, 2007.)
  23. 10203.55.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    This section defines an agricultural or horticultural loan commitment as a binding promise to lend money up to a fixed amount for agricultural or horticultural purposes, if issued by certain banks or credit associations lawfully operating in the state.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10203.55. An agricultural or horticultural loan commitment as used in Section 10203.5 and in Article 5.9 (commencing with Section 779.1), Chapter 1, Part 2, Division 1 means a binding agreement to loan money up to a fixed amount as needed for agricultural or horticultural purposes, which commitment is issued by: (1) A national or state commercial bank; or (2) A federal intermediate credit bank or a production credit association organized under the Farm Credit Act of 1933, as amended; lawfully operating in this State. (Amended by Stats. 1963, Ch. 313.)
  24. 10203.7.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    Life insurance that meets specified conditions counts as another form of group life insurance.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10203.7. Life insurance conforming to all the following conditions is another form of group life insurance: (a) Written under a policy covering when issued, not less than 10 agents. (b) Written under a policy issued to a principal, or if such principal be a life or life and disability insurer, by or to such principal, and with whom, or with an agent of whom, each of such agents is under contract to render personal services for a commission or other fixed or ascertainable compensation, the premium on which is to be paid by the principal or by the principal and the agents jointly, and insuring either all of the agents or all of any class or classes thereof, determined by conditions pertaining to the services to be rendered by such agents, provided that if a policy is intended to insure several such classes it may be issued to insure any such class of which 75 percent are covered and extended to other classes as 75 percent thereof express the desire to be covered. (c) For amounts of insurance based upon some plan which will preclude individual selection. (d) For the benefit of persons other than the principal. (e) When the premium is to be paid by the principal and agents jointly, and the benefits of the policy are offered to all eligible agents, written under a policy insuring, when issued, not less than 75 percent of such agents. (f) Terminating, if, subsequent to issue (1) the number of agents insured falls below 10 lives or 75 percent of the number eligible, and (2) the contribution of the agents, if the premiums for the insurance are on a renewable term insurance basis, exceed one dollar ($1) per month per one thousand dollars ($1,000) of insurance coverage plus an amount equal to any additional premium per one thousand dollars ($1,000) of insurance coverage charged to cover one or more hazardous occupations. Such insurance may be issued with or without medical examination. For the purpose of this section the term agents shall be deemed to include agents, solicitors and salesmen. (Amended by Stats. 1959, Ch. 571.)
  25. 10203.8.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

    Verify source ↗

    Life insurance that meets this section’s conditions is treated as another form of group life insurance.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10203.8. Life insurance conforming to all of the following conditions is another form of group life insurance: (a) Covering the lives of every eligible member of a group of persons who become or are named depositors under a savings account plan, established by a financial institution including subsidiary or affiliated persons, which plan provides for periodic deposits of like amounts. (b) The period during which the deposits may be made under the plan does not exceed 60 consecutive months, and the total amount of insurance under the policy on any one depositor does not exceed the difference between the amounts deposited and the maximum amount that may be deposited under the plan and does not exceed one thousand five hundred dollars ($1,500) on any one life. (c) The group numbers 100 new entrants yearly. (d) The policy is issued upon application of and made payable to the financial institution as beneficiary, and the premiums are paid by or through the financial institution. (e) The policy of insurance conforming to this section is not subject to Section 10209 or of this code or Section 704.100 of the Code of Civil Procedure. (Amended by Stats. 2006, Ch. 538, Sec. 468. Effective January 1, 2007.)
  26. 10203.9.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    A group life policy may be issued to replace an existing valid group life policy for an existing insured if specified benefit and coverage conditions are met.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10203.9. In addition to the other specific circumstances under which a group life policy may be issued under this chapter a group life policy may be issued to an existing insured to replace an existing valid group life policy if: (1) it provides the same benefits at the same or a lesser rate as the policy to be replaced: (2) it offers such benefits to all persons covered by the policy to be replaced; and (3) 90 percent of all persons covered by the policy to be replaced become insured under the new policy. (Added by Stats. 1955, Ch. 664.)
  27. 10204.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

    Verify source ↗

    This section defines “employer” and “employee” for this chapter of the Insurance Code.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10204. For the purpose of this chapter, the term “employer” includes the association or union designated by Section 10203, and the institution, vendor, credit union, or creditor designated by Sections 10203.5 and 10203.6, and the principal designated by Section 10203.7, and the trustees designated by Section 10202. 8, and the term “employee” includes the members of such union, credit union or association and the debtors of or purchasers from such institution, credit union, vendor or creditor, the agents referred to in Section 10203.7, and the employees and members referred to in Section 10202.8. (Amended by Stats. 1961, Ch. 142.)
  28. 10204.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

    Verify source ↗

    The commissioner may approve group life insurance if the insurer or applicant satisfies the listed conditions, and a $500 fee applies to each filing.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10204.5. (a) In addition to the issuance of group life insurance to groups in this state as permitted elsewhere in this chapter, the commissioner may approve the issuance of group life insurance if the insurer or applicant proves to the satisfaction of the commissioner each of the following: (1) The policy, when issued, covers no fewer than 10 eligible group members. (2) There is a common enterprise or economic or social affinity or relationship among members of the group. (3) The premiums charged are reasonable in relation to the benefits provided under the group insurance policy. (4) The issuance of the policy would result in economies of acquisition or administration, would be actuarially sound, and would not be contrary to the best interests of the public. (5) The group was formed in good faith for purposes other than obtaining insurance. (6) If the group policyholder is an association, the association has a constitution and bylaws and has been in existence for more than two years. (7) The insurer has been actively engaged in the business of writing the types of coverage offered in the group insurance policy for insureds other than the type of group covered by the policy, and is not organized solely or principally for the purpose of furnishing coverage to groups of this type. (b) An insurer under a policy covered by this section may exclude or limit the coverage on any person as to whom evidence of individual insurability is not satisfactory to the insurer. (c) A fee of five hundred dollars ($500) shall be charged to each insurer or applicant for each filing made pursuant to this section. (Added by Stats. 2005, Ch. 174, Sec. 1. Effective January 1, 2006.)
  29. 10205.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    Group life insurance policies cannot be issued or delivered, and insurers cannot offer or agree to provide group life coverage, until the policy form is filed with and approved by the commissioner.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10205. A policy of group life insurance shall not be issued or delivered in this State nor, except as otherwise provided in Section 10205.5, shall an insurer provide or agree to provide group life coverage until a copy of the form of the policy is filed with the commissioner and approved by him. Except as provided in Section 10211, such policy shall not be so issued or delivered unless it contains in substance the provisions set forth in Sections 10206 to 10210 hereof. (Amended by Stats. 1953, Ch. 624.)
  30. 10205.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    An insurer may start group life coverage before policy-form approval if stated conditions are met, then must submit the policy form, make required revisions, and end coverage if approval is not obtained on time.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10205.5. An insurer is permitted to provide group life coverage prior to the approval of the form of the policy if all of the conditions of (a) are met prior thereto and if thereafter it acts as required by (b). (a) The conditions precedent are: (1) The group is one eligible for coverage pursuant to the provisions of this article; and (2) An executed memorandum of insurance has been or is concurrently delivered to the entity which is to become the policyholder containing a provision that unless a policy the form of which has been approved by the commissioner and embodying the coverage has been issued and delivered to the policyholder within 90 days after the date on which the coverage is provided or agreed to be provided, the coverage provided pursuant to such memorandum terminates 120 days after such date, and containing a specification in either complete or summary form of: (i) The class or classes of employees eligible for coverage; (ii) The benefits to be provided; and (iii) The exceptions and reductions to such benefits, if any. (b) An insurer providing coverage pursuant to this section shall: (1) Within 60 days after the date on which the coverage is provided or agreed to be provided submit to the commissioner for approval a policy form drafted to provide the coverage provided by such memorandum and in a good faith attempt to meet all requirements of law; (2) Make such revisions in the policy submitted as the commissioner may lawfully require; and (3) Terminate such coverage in accordance with the provisions of (a) (2) above if approval of such policy is not secured within the time specified therein. Upon written request from the insurer filed within 50 days after the date on which the coverage is provided or agreed to be provided and upon proof satisfactory to him that the insurer is acting with due diligence and that hardship will result unless an extension is granted, the commissioner may extend the time set forth in (b) (1) hereof for a period of not to exceed 30 days. Upon such extension, the insurer with the consent of the policyholder may amend the memorandum of insurance referred to in (a) (2) hereof to extend the time within which the policy must be issued and delivered to the policyholder to 30 days after the date to which the commissioner has extended the time within which a policy form must be submitted to him for approval and to extend the date for termination of coverage to 30 days thereafter. Any policy submitted to the commissioner with a letter from the insurer stating that coverage has been provided in accordance with this section shall be automatically approved unless the commissioner disapproves the same within 30 days of the date of its submission to him. (Added by Stats. 1953, Ch. 624.)
  31. 10205.6.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    The commissioner may suspend or revoke an insurer’s permission under Section 10205.5 after notice and hearing if specified misconduct or noncompliance is found.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10205.6. The commissioner may suspend or revoke the permission granted any insurer in Section 10205.5 if, after notice and hearing in accordance with Chapter 5 of Part 1 of Division 3 of Title 2 of the Government Code, he finds that the insurer has: (a) Misrepresented the conditional nature of the coverage; (b) Neglected or refused either to cancel or otherwise terminate such coverage within the time required by such section; (c) Delivered any such memorandum which did not comply with subsection (a) (2) of Section 10205.5; (d) Shown a lack of diligence in making revisions in the policy necessary to obtain its approval by the commissioner; (e) Failed so often in so many important respects in drafting any such policy to conform to the applicable requirements of the Insurance Code that a conclusion of lack of good faith or competency in drafting is reasonably justified; (f) Circulated announcements of coverage to individuals insured which failed to advise them of the conditional nature of the coverage; or (g) In any other manner so negligently or carelessly handled the effecting of insurance under Section 10205.5 or the administration thereof that the policyholder or the persons insured have been misled or exposed to the danger of loss. (Added by Stats. 1953, Ch. 624.)
  32. 10206.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    A group life policy must limit contesting the policy after two years, except for nonpayment of premiums, and restrict use of employee statements about insurability unless they are in a written application signed by the employee. If an impostor is substituted during application or enrollment with photographic ID presented, no contract is formed and the purported contract is void from the start.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10206. (a) The policy shall provide that the validity of the policy shall not be contested, except for nonpayment of premiums, after it has been in force for two years from its date of issue; and that no statement made by any employee insured under the policy relating to his or her insurability shall be used in contesting the validity of the insurance with respect to which the statement was made after the insurance has been in force prior to the contest for a period of two years during the employee’s lifetime nor unless it is contained in a written application signed by the employee. (b) (1) Notwithstanding subdivision (a), if photographic identification is presented during the application or enrollment process, and if an impostor is substituted for a named insured in any part of the application or enrollment process, with or without the knowledge of the named insured, then no contract between the insurer and the named insured is formed, and any purported insurance contract is void from its inception. (2) As used in this subdivision: (A) “Application or enrollment process” means any or all of the steps required of a named insured in applying for a certificate under a group policy of life insurance, including, but not limited to, executing any part of the application or enrollment form, submitting to medical or physical examination or testing, or providing a sample or specimen of blood, urine, or other bodily substance. (B) “Impostor” means a person other than the named insured who participates in any manner in the application or enrollment process for a certificate under a group life insurance policy and represents himself or herself to be the named insured or represents that a sample or specimen of blood, urine, or other bodily substance is that of the named insured. (C) “Named insured” means the individual named in an application or enrollment form for a certificate under a group life insurance policy as the person whose life is to be insured. (Amended by Stats. 1998, Ch. 184, Sec. 2. Effective January 1, 1999.)
  33. 10206.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    A group life policy may exclude or reduce coverage for losses caused by war, military or naval service, or aviation. The commissioner may also set reasonable rules on how these provisions are used, after notice and hearing.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10206.5. The policy may provide that the insurer is not liable, or is liable only in a reduced amount, for losses arising from conditions: (a) Relating to war or act of war; (b) Relating to military or naval service; (c) Relating to aviation. The commissioner may after notice and hearing prescribe reasonable rules and regulations relative to the use of provisions permitted by this section in respect to policies outstanding or hereafter issued. (Added by Stats. 1943, Ch. 909.)
  34. 10207.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    A group life insurance policy must include a provision stating that the policy, the employer’s application, and any employee applications make up the entire contract, and that related statements are treated as representations, not warranties, unless there is fraud.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10207. The policy shall contain a provision that: (a) The policy, the application of the employer and the individual applications, if any, of the employees constitute the entire contract of insurance. (b) All statements made by the employer or by the individual employees are, in the absence of fraud, representations and not warranties. (c) Such statements will not be used in defense to a claim under the policy, unless contained in a written application. (Enacted by Stats. 1935, Ch. 145.)
  35. 10208.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    The policy must include a provision for equitable adjustment if an employee’s age is misstated.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10208. The policy shall contain a provision for the equitable adjustment of the premium or the amount of insurance payable in the event of a misstatement of the age of an employee. (Enacted by Stats. 1935, Ch. 145.)
  36. 10209.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    The insurer must provide an individual certificate through the employer, and the section gives employees a right to convert coverage to an individual life policy after termination if they apply and pay within 31 days.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10209. (a) Except as provided by Sections 10203.5 and 10203.8, the policy shall contain a provision that the insurer will issue to the employer for delivery to the insured employee an individual certificate setting forth: (1) A statement as to the insurance protection to which the employee is entitled and to whom payable. (2) A provision that if the employment terminates for any reason whatsoever and the employee applies to the insurer within 31 days after the termination, paying the premium applicable to the class of risk to which he or she belongs and to the form and amount of the policy at his or her then attained age, he or she is entitled, without producing evidence of insurability, to the issue by the insurer of any individual life policy in any one of the forms, other than term insurance, customarily issued by the insurer. (3) A statement that the policy in lieu of group insurance will be in an amount equal to the amount of his or her protection under the group insurance at the time of the termination. (4) A provision that if the employee dies during the 31-day period within which he or she is entitled to have an individual policy issued to him or her in accordance with this section and before the policy shall have become effective, the amount of life insurance that the employee is entitled to have issued to him or her under the individual policy shall be payable as a claim under the group policy, whether or not application for the individual policy or the payment of the first premium therefor has been made. (b) If any employee insured under a group life insurance policy delivered in this state becomes entitled under the terms of the policy to have an individual policy of life insurance issued to him or her without evidence of insurability, subject to making of application and payment of the first premium within the period specified in the policy, and if the employee is not given notice of the existence of the right at least 15 days prior to the expiration date of the period, the employee shall have an additional period within which to exercise the right, but nothing in this section shall be construed to continue any insurance beyond the period provided in the policy. This additional period shall expire 25 days next after the employee is given the notice but in no event shall the additional period extend beyond 60 days next after the expiration date of the period provided in the policy. Written notice presented to the employee or mailed by the policyholder to the last-known address of the employee or mailed by the insurer to the last-known address of the employee as furnished by the policyholder shall constitute notice for the purpose of this section. (c) Paragraphs (2) and (4) of subdivision (a), and subdivision (b), shall apply to any insurance issued pursuant to Section 10203.4 on the life of a spouse of an employee. (d) The contract of insurance and individual certificate may contain provisions defining the extent to which the employer acts as the agent of the employee or may act as the agent of the insurer. (Amended by Stats. 2006, Ch. 538, Sec. 469. Effective January 1, 2007.)
  37. 10209.1.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    Individual certificates in group life policies must be individualized, unless the policy requires no regular employee premium contribution and the certificate clearly states eligibility conditions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10209.1. An individual certificate shall be individualized, except that in the case of an individual certificate issued under a group policy which requires no regular contribution toward the payment of the premium to be made by the employees covered thereunder, such individual certificate need not be individualized if it is in a form setting forth a clear statement of the conditions of eligibility from which the employee can determine the circumstances under which he is insured under the master policy. An individual certificate shall be deemed to be “individualized,” within the meaning of this section, if it contains either the name of the employee covered or some other means of identifying to the employee covered that it is his individual certificate. (Added by Stats. 1955, Ch. 1729.)
  38. 10209.3.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    This section lets insured people under group life policies assign ownership interests, and gives terminally ill insured people a right to make an absolute assignment for value. A viatical broker must notify the spouse of a terminally ill viator of the viatication.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10209.3. (a) Subject to the terms of the policy, or pursuant to an agreement between the insured, the group policyholder, and the insurer, any person insured under a group life insurance policy may make to any person, other than the policyholder, an assignment of all or any part of the incidents of ownership conferred on him or her by the policy or by law, including specifically, but not by way of limitation, the right to exercise the conversion privilege and the right to name a beneficiary. The enactment of this section made at the 1969 Regular Session of the Legislature does not constitute a change in, but is declaratory of, the existing law. (b) Notwithstanding subdivision (a), any person who has been diagnosed with a terminal illness shall have the right to make an absolute assignment for value of his or her interest in a policy or certificate of life insurance. (c) The right of assignment in subdivision (b) shall not extend to situations in which the benefits of the policy or certificate of life insurance are used as collateral for a loan. (d) The viatical broker shall notify the spouse of a terminally ill viator of the viatication. (Amended by Stats. 1997, Ch. 440, Sec. 2. Effective January 1, 1998.)
  39. 1021.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. )

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    After a liquidation order, the commissioner must publish notice and claimants must file claims with proper proof within the stated time period, unless a listed guarantee association exception applies.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. ) ## 1021. (a) Upon the making of an order to liquidate the business of such person, the commissioner shall publish notice to its policyholders, creditors, shareholders, and all other persons interested in its assets. The order and the notice shall require claimants to file their claims with the commissioner, together with proper proofs thereof, within six months to one year, at the commissioner’s discretion, after the date of first publication of such notice, in the manner specified in this article. (b) The time period specified in subdivision (a) shall not apply to the California Insurance Guarantee Association or the California Life and Health Insurance Guarantee Association provided it files with the commissioner a notice of possible claim within such six-month period and files actual claim or claims within such periods of time as may be permitted by order of court. (c) Notwithstanding the provisions of subdivision (a), both of the following apply: (1) If the commissioner determines that the business subject to liquidation order possesses, or is likely to possess, insufficient assets to permit significant distribution to a person interested in those assets, the commissioner may decline to handle a claim submitted pursuant to subdivision (a), as long as the notice requirements of subdivision (a) and Section 1022 are observed. (2) If the commissioner reasonably determines that the business subject to liquidation order possesses, or is likely to possess, insufficient assets to permit significant distribution of funds to pay the expenses of administration under this article, as provided in paragraph (1) of subdivision (a) of Section 1033, the commissioner may decline to continue, and may abandon, the insolvency proceeding upon providing notice pursuant to subdivision (a) and Section 1022. (Amended by Stats. 1995, Ch. 578, Sec. 3. Effective January 1, 1996.)
  40. 10210.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    The policy must include a rule adding newly eligible employees to the insured groups over time, and it may also delay coverage for certain jointly paid cases until insurability evidence is provided.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10210. The policy shall contain a provision that to the groups or classes originally insured there will be added from time to time all new employees of the employer eligible for insurance in such groups or classes, except that the policy may provide that if the premium is paid by the employer and employees jointly any employee who fails to request insurance during the period of eligibility following his employment as prescribed by the policy shall not be insured until he has furnished evidence of insurability satisfactory to the insurer. (Amended by Stats. 1945, Ch. 513.)
  41. 10210.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    The policyholder generally handles premium transmission or collection, unless the policy says someone else will. In some group life policies, the insurer may collect or assist with collections, and if more than 100 employers or employees are covered, the policy must state the insurer’s collection charge separately.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10210.5. Whenever any provision of this chapter requires the payment of a premium by any person, such requirement relates to the responsibility for the payment of the premium and not to the transmission or collection of the premium or premium contributions. Such transmission or collection shall be performed by the policyholder, except where the policy specifies the persons other than the policyholder by whom such transmission or collection shall be made, and in one of the following situations: (a) If such policy covers the employees of more than one employer, the insurer may collect premium contributions from individual employers whose employees are insured or may assist the policyholder in making such collections. If the employees of more than 100 such employers are covered under such policy, it shall state as a separate part of the premium to be charged for the policy the amount to be charged by the insurer for such collection. (b) If the policy covers a group of governmental employees and the governmental unit paying such employees will not transmit their premium contribution after pay roll deduction, the insurer may collect from the individual employees. If more than 100 such employees are covered under such policy, it shall state as a separate part of the premium to be charged for the policy the amount to be charged by the insurer for such collection. (c) If individual members of the group make payment of their share of the premium contribution to the insurer without billing or solicitation by the insurer during a period of temporary absence from active work of not exceeding 90 days, such payment may be received without the necessity of any separately stated charge by the insurer. (Added by Stats. 1953, Ch. 624.)
  42. 10211.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    Group life insurance policies may include certain permitted provisions, including provisions required by the law of the insurer’s home jurisdiction or the place of issue, and provisions the commissioner views as more favorable to the employer or employee.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10211. Policies of group life insurance may conform to the following conditions, any other provisions of this chapter notwithstanding: (a) When issued in this State by any foreign insurer, they may contain any provision required by the law of the State under which the insurer is organized. (b) When issued in other States or countries by domestic insurers, they may contain any provision required by the laws of the State, or country, in which they are issued. (c) They may contain provisions on any of the requirements set forth in sections 10205 to 10210, which, in the opinion of the commissioner, are more favorable to the employer or to the employee than the required provisions. (Enacted by Stats. 1935, Ch. 145.)
  43. 10212.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    For group policies issued by a domestic life insurer, the employer is treated as the policyholder, except as this chapter provides otherwise. If the employer may vote at insurer meetings, the employer gets one vote.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10212. Except as provided in this chapter, in every group policy issued by a domestic life insurer, the employer is the policyholder for all purposes within the meaning of this code. If entitled to vote at meetings of the insurer, he shall be entitled to one vote. (Enacted by Stats. 1935, Ch. 145.)
  44. 10214.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. )

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    If dividends or premium refunds are paid under a group life insurance policy, the policyholder must use any excess for the benefit of insured employees, members, or their dependents.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2. Group Life Policies [10200 - 10214] ( Chapter 2 enacted by Stats. 1935, Ch. 145. ) ## 10214. If hereafter any dividend is paid or any premium refunded under any policy of group life insurance heretofore or hereafter issued, the excess, if any, of the aggregate dividends or premium refunds under such policy over the aggregate expenditures for insurance under such policy made from funds contributed by the policyholder, or by an employer of insured persons or by union or association to which such insured persons belong, including expenditures made in connection with the administration of such policy, shall be applied by the policyholder for the benefit of such insured employees generally or their dependents or insured members generally or their dependents. For the purpose of this section and at the option of the policyholder, “policy” may include all group life and disability insurance policies of the policyholder. (Added by Stats. 1953, Ch. 1746.)
  45. 1022.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. )

    Verify source ↗

    The notice must be published in newspapers of general circulation in the liquidation area, must point readers to a company or liquidator website for ongoing creditor information, and a copy with an affidavit of publication must be filed with the clerk of the court.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. ) ## 1022. The notice shall be published in newspapers of general circulation in geographic areas pertinent to the liquidation. The notice shall reference a source, either the liquidated company’s or the liquidator’s Internet Web site, where ongoing information for creditors shall be provided. A copy of the notice, accompanied by an affidavit of due publication, including a statement of the date of publication, shall be filed with the clerk of the court. (Amended by Stats. 2012, Ch. 786, Sec. 13. (AB 2303) Effective January 1, 2013.)
  46. 10220.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.5. Blanket Life Insurance [10220 - 10225] ( Chapter 2.5 added by Stats. 1957, Ch. 367. )

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    Any life insurer may issue blanket life insurance policies for up to one year, at rates below the usual rates for that insurance.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.5. Blanket Life Insurance [10220 - 10225] ( Chapter 2.5 added by Stats. 1957, Ch. 367. ) ## 10220. Any life insurer may issue policies of blanket life insurance for a term not exceeding one year with premium rates less than the usual rates for such insurance. Such policies may thereafter be renewed. (Added by Stats. 1957, Ch. 367.)
  47. 10221.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.5. Blanket Life Insurance [10220 - 10225] ( Chapter 2.5 added by Stats. 1957, Ch. 367. )

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    Only the forms of blanket life insurance listed in this chapter are allowed.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.5. Blanket Life Insurance [10220 - 10225] ( Chapter 2.5 added by Stats. 1957, Ch. 367. ) ## 10221. The only forms of blanket life insurance are those set forth in this chapter. (Added by Stats. 1957, Ch. 367.)
  48. 10222.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.5. Blanket Life Insurance [10220 - 10225] ( Chapter 2.5 added by Stats. 1957, Ch. 367. )

    Verify source ↗

    This section says when life insurance counts as blanket life insurance and gives an insured person a right to request a policy copy if they paid the premium.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.5. Blanket Life Insurance [10220 - 10225] ( Chapter 2.5 added by Stats. 1957, Ch. 367. ) ## 10222. Life insurance conforming to all the following conditions is one form of blanket life insurance: (a) Written under a policy issued to a newspaper, farm paper, magazine, or other periodical publication; (b) Insuring independent contractors, such as newspaperboys, dealers, distributors, wholesalers, or other personnel, engaged in the sale, distribution, collecting for, or other activities pertaining to the marketing and delivery of publications referred to in subdivision (a), including attending coaching school or while participating in a trip organized, supervised, and sponsored as a reward for meritorious service, for amounts of insurance based upon a plan precluding individual selection; (c) For the benefit of persons other than the policyholder; (d) Where the premium is remitted by the policyholder; (e) Insuring persons without any requirement for individual enrollment and without individual commitment or undertaking to pay, and with either the policyholder or the insured to pay all the premium or part of the premium as a condition precedent to coverage. Nothing in this section shall be construed to prohibit the cost of the insurance coverage being borne by the individuals insured or by their parents or guardians. When the premium for the insurance is paid by the person insured, he may, upon request, obtain from the insurer in certificate form a copy of the policy. Coverage shall not be provided to any person who files with the entity to whom the blanket policy is to be issued, for delivery to the insurer, a written statement requesting that he not be covered. In the case of a minor, such statement may be filed by his parent or guardian. If the number of persons filing such statements exceeds ten percent (10%) of the number of persons within categories defined as covered under the policy, it shall not be put into effect, and if in effect shall not be renewed. (Added by Stats. 1957, Ch. 367.)
  49. 10223.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.5. Blanket Life Insurance [10220 - 10225] ( Chapter 2.5 added by Stats. 1957, Ch. 367. )

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    A blanket life insurance policy may exclude or reduce coverage for losses tied to war, military or naval service, or aviation. The commissioner may also set reasonable rules on these provisions after notice and hearing.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.5. Blanket Life Insurance [10220 - 10225] ( Chapter 2.5 added by Stats. 1957, Ch. 367. ) ## 10223. A blanket life insurance policy may provide that the insurer is not liable, or is liable only in a reduced amount, for losses arising from conditions: (a) Relating to war or acts of war; (b) Relating to military or naval service; (c) Relating to aviation. After notice and hearing the commissioner may prescribe reasonable rules and regulations relative to the use of provisions permitted by this section in respect to policies outstanding or hereafter issued. (Added by Stats. 1957, Ch. 367.)
  50. 10224.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.5. Blanket Life Insurance [10220 - 10225] ( Chapter 2.5 added by Stats. 1957, Ch. 367. )

    Verify source ↗

    Blanket life insurance policies may include certain provisions allowed by the applicable law, despite other chapter rules.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.5. Blanket Life Insurance [10220 - 10225] ( Chapter 2.5 added by Stats. 1957, Ch. 367. ) ## 10224. Policies of blanket life insurance may conform to the following conditions, any other provisions of this chapter notwithstanding: (a) When issued in this State by any foreign insurer, such policies may contain any provision required by the law of the state under which the insurer is organized. (b) When issued in other states or countries by domestic insurers, such policies may contain any provision required by the laws of the state, or country, in which they are issued. (Added by Stats. 1957, Ch. 367.)
  51. 10225.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.5. Blanket Life Insurance [10220 - 10225] ( Chapter 2.5 added by Stats. 1957, Ch. 367. )

    Verify source ↗

    A blanket life insurance policy may not be delivered or issued for delivery in this state until its form has been filed with, and approved by, the commissioner.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.5. Blanket Life Insurance [10220 - 10225] ( Chapter 2.5 added by Stats. 1957, Ch. 367. ) ## 10225. A policy of blanket insurance shall not be delivered or issued for delivery in this State until a copy of the form of the policy is filed with and approved by the commissioner. (Added by Stats. 1957, Ch. 367.)
  52. 1023.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. )

    Verify source ↗

    A claim must be filed under oath on the commissioner’s prescribed form and include specified details and supporting documents.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. ) ## 1023. A claim must set forth, under oath, on the form prescribed by the commissioner: (a) The particulars thereof, and the consideration therefor. (b) Whether said claim is secured or unsecured, and, if secured, the nature and amount of such security. (c) The payments, if any, made thereon. (d) That the sum claimed is justly owing from such person to the claimant. (e) That there is no offset to the claim. (f) Such other data or supporting documents as the commissioner requires. (Amended by Stats. 1935, Ch. 291.)
  53. 10231.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 1. Definitions [10231 - 10231.8] ( Heading of Article 1 renumbered from Article 2 by Stats. 1992, Ch. 1132, Sec. 2. )

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    The definitions in this article control how this chapter is interpreted, unless the context requires otherwise.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 1. Definitions [10231 - 10231.8] ( Heading of Article 1 renumbered from Article 2 by Stats. 1992, Ch. 1132, Sec. 2. ) ## 10231. Unless the context requires otherwise, the definitions in this article shall govern the construction of this chapter. (Added by Stats. 1988, Ch. 1342, Sec. 1.)
  54. 10231.2.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 1. Definitions [10231 - 10231.8] ( Heading of Article 1 renumbered from Article 2 by Stats. 1992, Ch. 1132, Sec. 2. )

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    This section defines “long-term care insurance” and says long-term care policies, certificates, and riders are regulated under this chapter; the commissioner must review and approve certain policies and coverage outlines.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 1. Definitions [10231 - 10231.8] ( Heading of Article 1 renumbered from Article 2 by Stats. 1992, Ch. 1132, Sec. 2. ) ## 10231.2. “Long-term care insurance” includes any insurance policy, certificate, or rider advertised, marketed, offered, solicited, or designed to provide coverage for diagnostic, preventive, therapeutic, rehabilitative, maintenance, or personal care services that are provided in a setting other than an acute care unit of a hospital. Long-term care insurance includes all products containing any of the following benefit types: coverage for institutional care including care in a nursing home, convalescent facility, extended care facility, custodial care facility, skilled nursing facility, or personal care home; home care coverage including home health care, personal care, homemaker services, hospice, or respite care; or community-based coverage including adult day care, hospice, or respite care. Long-term care insurance includes disability based long-term care policies but does not include insurance designed primarily to provide Medicare supplement or major medical expense coverage. Long-term care policies, certificates, and riders shall be regulated under this chapter. The commissioner shall review and approve individual and group policies, certificates, riders, and outlines of coverage. Other applicable laws and regulations shall also apply to long-term care insurance insofar as they do not conflict with the provisions in this chapter. Long-term care benefits designed to provide coverage of 12 months or more that are contained in or amended to Medicare supplement or other disability policies and certificates shall be regulated under this chapter. (Amended by Stats. 2001, Ch. 159, Sec. 147. Effective January 1, 2002.)
  55. 10231.3.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 1. Definitions [10231 - 10231.8] ( Heading of Article 1 renumbered from Article 2 by Stats. 1992, Ch. 1132, Sec. 2. )

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    This section defines long-term care planning terms and sets rules for alternate plans of care in applicable policies.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 1. Definitions [10231 - 10231.8] ( Heading of Article 1 renumbered from Article 2 by Stats. 1992, Ch. 1132, Sec. 2. ) ## 10231.3. (a) For the purposes of this section, the following definitions apply: (1) An “alternate plan of care” means a plan of care that includes a specification of long-term care services, providers, or places of care that are not specifically defined as covered services, providers, or places of care under the policy. The alternate plan of care shall be developed by a licensed health care practitioner, describe the insured’s needs, and specify the type, frequency, and providers of all formal and informal long-term care services that are required by the insured and the cost, if any. The services, providers, and places of care specified in an alternate plan of care shall include those that are specifically defined as covered services, providers, and places under the policy, as well as those that are not specifically defined as covered services, providers, and places under the policy. (2) An “alternate-plan-of-care provision” means a provision in a policy, rider, endorsement, or amendment that allows benefits for services, providers, and places of care that are specified in an alternate plan of care. (3) “Licensed health care practitioner” means a physician, registered nurse, licensed social worker, or other individual whom the United States Secretary of the Treasury may prescribe by regulation. (4) “Plan of care” means a written description of the insured’s needs and a specification of the type, frequency, and providers of all formal and informal long-term care services required by the insured and the cost, if any. (b) An alternate-plan-of-care provision shall provide for all of the following: (1) An alternate plan of care may be proposed by the insured or the insurer. Adoption, amendment, or replacement of an alternate plan of care shall be agreed to by the insured, the insurer, and a licensed health care practitioner that is independent of the insurer. Consent or agreement to an alternate plan of care shall be free and mutual. (2) The maximum benefit available under the contract shall not change based on an insured utilizing an alternate plan of care, but that benefit will be reduced by the amount of any benefits paid under an alternate plan of care. (3) Policy benefits are payable for all services, providers, and places of care that are specified in an alternate plan of care. Coverage for services, providers, and places of care under an alternate plan of care shall be in addition to, not in lieu of, coverage for services, providers, and places of care that are specifically defined as covered services under the policy. (4) If adopted, an alternate plan of care replaces any existing plan of care, including any previously adopted alternate plan of care. No benefits are payable for services provided pursuant to a plan of care after it is replaced by an alternate plan of care. (5) An alternate plan of care can be replaced by a new plan of care at any time. (A) If the new plan of care is not an alternate plan of care, the new plan of care does not need to be adopted in the manner described in paragraph (1) of this subdivision. (B) If the new plan of care is a new or amended alternate plan of care, the new or amended alternate plan of care shall be adopted in the manner described in paragraph (1) of this subdivision. (C) No benefits are payable for services provided pursuant to an alternate plan of care after it is replaced by a new plan of care. (c) Nothing in this section shall be construed to require an insurer to include a provision authorizing an alternate plan of care. However, an insurer and an insured may agree to use an alternate plan of care even if there is no provision in the policy that specifically authorizes one. Nothing in this section is intended to obligate either party to negotiate an alternate plan of care. If an insurer does not accept an extra-contractual request for an alternate plan of care, the rejection is not a denial of a claim. (d) This section shall apply to policies issued on or after January 1, 2017. (Amended by Stats. 2018, Ch. 98, Sec. 1. (AB 2180) Effective January 1, 2019.)
  56. 10231.4.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 1. Definitions [10231 - 10231.8] ( Heading of Article 1 renumbered from Article 2 by Stats. 1992, Ch. 1132, Sec. 2. )

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    This section defines “applicant” for long-term care insurance policies.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 1. Definitions [10231 - 10231.8] ( Heading of Article 1 renumbered from Article 2 by Stats. 1992, Ch. 1132, Sec. 2. ) ## 10231.4. “Applicant” means either of the following: (a) In the case of an individual long-term care insurance policy, the person who seeks to contract for benefits. (b) In the case of a group long-term care insurance policy, the proposed certificate holder. (Added by Stats. 1988, Ch. 1342, Sec. 1.)
  57. 10231.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 1. Definitions [10231 - 10231.8] ( Heading of Article 1 renumbered from Article 2 by Stats. 1992, Ch. 1132, Sec. 2. )

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    “Certificate” means a certificate issued under a group long-term care insurance policy delivered or issued for delivery in this state.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 1. Definitions [10231 - 10231.8] ( Heading of Article 1 renumbered from Article 2 by Stats. 1992, Ch. 1132, Sec. 2. ) ## 10231.5. “Certificate” means any certificate issued under a group long-term care insurance policy, which policy has been delivered or issued for delivery in this state. (Added by Stats. 1988, Ch. 1342, Sec. 1.)
  58. 10231.6.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 1. Definitions [10231 - 10231.8] ( Heading of Article 1 renumbered from Article 2 by Stats. 1992, Ch. 1132, Sec. 2. )

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    This section defines “group long-term care insurance” and requires an association or its insurer to file evidence with the commissioner before advertising or offering the policy in the state.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 1. Definitions [10231 - 10231.8] ( Heading of Article 1 renumbered from Article 2 by Stats. 1992, Ch. 1132, Sec. 2. ) ## 10231.6. “Group long-term care insurance” means a long-term care insurance policy which is delivered or issued for delivery in this state and issued to any of the following: (a) One or more employers or labor organizations, or a trust or to the trustees of a fund established by one or more employers or labor organizations, or a combination thereof, for employees or former employees or a combination thereof or for members or former members or a combination thereof, of the labor organization. (b) Any professional, trade, or occupational association for its members or former or retired members, or combination thereof, if that association meets both of the following: (1) Is composed of individuals all of whom are or were actively engaged in the same profession, trade, or occupation. (2) Has been maintained in good faith for purposes other than obtaining insurance. (c) An association or a trust or the trustees 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 or a certificate within this state, the association or associations, or the insurer of the association or associations, shall file evidence with the commissioner that the association or associations have at the outset a minimum of 100 persons and have been organized and maintained in good faith for a primary purpose other than that of obtaining insurance, have been in active existence for at least one year, have a constitution and bylaws which provide all of the following, and provide evidence that the following have been consistently implemented: (1) The association or associations hold regular meetings, not less than annually, to further purposes of the members. (2) Except for credit unions, the association or associations collect dues or solicit contributions from members. (3) The members have voting privileges and representation on the governing board and committees. Thirty days after that filing the association or associations shall be deemed to satisfy these organizational requirements, unless the commissioner makes a finding that the association or associations do not satisfy those organizational requirements. (d) A group other than as described in subdivisions (a), (b), and (c), subject to all of the following findings by the commissioner: (1) The issuance of the group policy or certificate is not contrary to the best interest of the public. (2) The issuance of the group policy will result in economies of acquisition or administration. (3) The benefits are reasonable in relation to the premiums charged. (4) The use of the true or fictitious name of the group, group master policyholder, group policy, certificate, or any trust or other entity created or used for the marketing of the group policy or certificates is not deceptive or misleading with regard to the status, character, or proprietary or representative capacity of the insurer, group, trust, or other entity. (5) The group’s main revenue source is not related to the marketing of insurance. (6) The group’s outreach method to obtain new members is not related to the solicitation of insurance. (7) The group provides benefits or services, other than insurance, of significant value to its members. The commissioner shall investigate the percentage of members using the other services and the monetary value of those services. (e) A life care contract provider which has received a certificate of authority in accordance with Chapter 10 (commencing with Section 1770) of Division 2 of the Health and Safety Code. Any life care contract provider which has not received the certificate of authority from the State Department of Social Services shall be subject to this chapter. (Amended by Stats. 1992, Ch. 1132, Sec. 5. Effective January 1, 1993.)
  59. 10231.8.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 1. Definitions [10231 - 10231.8] ( Heading of Article 1 renumbered from Article 2 by Stats. 1992, Ch. 1132, Sec. 2. )

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    “Policy” is defined to include certain insurance-related contracts and endorsements delivered or issued for delivery in this state by specified organizations.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 1. Definitions [10231 - 10231.8] ( Heading of Article 1 renumbered from Article 2 by Stats. 1992, Ch. 1132, Sec. 2. ) ## 10231.8. “Policy” means any policy, contract, subscriber agreement, rider or endorsement delivered or issued for delivery in this state by an insurer, fraternal benefit society, nonprofit hospital service plan, or any similar organization, regulated by the commissioner. (Added by Stats. 1988, Ch. 1342, Sec. 1.)
  60. 10232.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    Group long-term care insurance coverage for certain out-of-state group policies cannot be offered or sold in this state unless the commissioner has made the required determination, and the required filings are made in advance.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232. (a) No group long-term care insurance coverage may be offered or sold to a resident of this state under a group policy issued in another state to a group described in subdivision (d) of Section 10231.6, unless the commissioner has determined that the requirements imposed by subdivision (d) of Section 10231.6 have been met. At least 30 days in advance of advertising, marketing, or offering coverage within this state, an insurer issuing a policy to a group described in subdivision (d) of Section 10231.6 shall accomplish an informational filing with the commissioner which consists of the following materials: (1) A specimen master policy and certificate. (2) The corresponding outline of coverage. (3) Representative advertising materials to be used in this state. (4) At the option of the insurer, any other documentation which the insurer believes will provide information sufficient to allow the commissioner to determine that the requirements of subdivision (d) of Section 10231.6 have been met or which establishes that the insurance regulatory authority of another state has made a determination that the requirements have been met, or both. (b) No group long-term care insurance coverage may be offered or sold to a resident of this state under a group policy issued in another state to a group described in subdivision (c) of Section 10231.6, unless, prior to advertising, marketing, or offering that coverage within this state, the association or associations, or the insurer of the association or associations, files evidence with the commissioner that the association or associations have at the outset a minimum of 100 persons, have been organized and maintained in good faith for a primary purpose other than that of obtaining insurance, have been in active existence for at least one year, have a constitution and bylaws which provide all of the following, and provide evidence that the following have been consistently implemented: (1) The association or associations hold regular meetings, not less than annually, to further purposes of the members. (2) Except for credit unions, the association or associations collect dues or solicit contributions from members. (3) The members have voting privileges and representation on the governing board and committees. Thirty days after that filing, the association or associations shall be deemed to satisfy those organizational requirements, unless the commissioner makes the finding that the association or associations do not satisfy those organizational requirements. The association or associations, or the insurer of the association or associations, shall accompany this organizational filing with an informational filing which consists of the following materials: (1) A specimen master policy and certificate. (2) The corresponding outline of coverage. (3) Representative advertising materials to be used in this state. (c) Compliance with the informational filings required to be made by this section shall also constitute compliance with the filing requirements of Section 10233.9. (d) The materials required to be filed with the commissioner by this section shall be filed with the commissioner for informational purposes only, and not for approval purposes. (Amended by Stats. 1992, Ch. 1132, Sec. 6. Effective January 1, 1993.)
  61. 10232.1.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    Certain long-term care insurance policies and certificates must be labeled with specific words on the first page, outline of coverage, and application; the commissioner may allow more descriptive alternative wording.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.1. (a) Every policy that is intended to be a qualified long-term care insurance contract as provided by Public Law 104-191 shall be identified as such by prominently displaying and printing on page one of the policy form and the outline of coverage and in the application the following words: “This contract for long-term care insurance is intended to be a federally qualified long-term care insurance contract and may qualify you for federal and state tax benefits.” Every policy that is not intended to be a qualified long-term care insurance contract as provided by Public Law 104-191 shall be identified as such by prominently displaying and printing on page one of the policy form and the outline of coverage and in the application the following words: “This contract for long-term care insurance is not intended to be a federally qualified long-term care insurance contract.” (b) Any policy or certificate in which benefits are limited to the provision of institutional care shall be called a “nursing facility and residential care facility only” policy or certificate and the words “Nursing Facility and Residential Care Facility Only” shall be prominently displayed on page one of the form and the outline of coverage. The commissioner may approve alternative wording if it is more descriptive of the benefits. (c) Any policy or certificate in which benefits are limited to the provision of home care services, including community-based services, shall be called a “home care only” policy or certificate and the words “Home Care Only” shall be prominently displayed on page one of the form and the outline of coverage. The commissioner may approve alternative wording if it is more descriptive of the benefits. (d) Any policy, certificate, or rider in which benefits are limited to the provision of all care settings, except nursing facility care, and that is offered under the California Partnership for Long-Term Care Program established by Section 22000 of the Welfare and Institutions Code shall be called a home care, community-based services, and residential care facility only policy, certificate, or rider and the words “Home Care, Community-Based Services, and Residential Care Facility Only” shall be prominently displayed on the first page of the form and the outline of coverage. The commissioner may approve an alternative version of those words if the alternative version is more descriptive of the benefits provided. (e) Only those policies or certificates providing benefits for both institutional care and home care may be called “comprehensive long-term care” insurance. (Amended by Stats. 2018, Ch. 565, Sec. 1. (SB 1248) Effective January 1, 2019.)
  62. 10232.2.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    This section requires certain insurers to file, offer, and market non-federally qualified long-term care policies, and it sets rules for approved contracts and grandfathered group policies.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.2. (a) Every insurer that offers policies or certificates that are intended to be federally qualified long-term care insurance contracts, including riders to life insurance policies providing long-term care coverage, shall fairly and affirmatively concurrently file, offer, and market long-term care insurance policies or certificates not intended to be federally qualified, as described in subdivision (a) of Section 10232.1. (b) All long-term care insurance contracts, including riders to life insurance contracts providing long-term care coverage, approved after the effective date of this section shall meet all of the requirements of this chapter. (c) Until October 1, 2001, or 90 days after approval of contracts submitted for approval pursuant to subdivision (b), whichever comes first, insurers may continue to offer and market previously approved long-term care insurance contracts. (d) Group policies issued prior to January 1, 1997, shall be allowed to remain in force and not be required to meet the requirements of this chapter, as amended during the 1997 portion of the 1997–98 Regular Session, unless those policies cease to be treated as federally qualified long-term care insurance contracts. If a policy or certificate issued on a group policy of that type ceases to be a federally qualified long-term care insurance contract under the grandfather rules issued by the United States Department of the Treasury pursuant to Section 7702B(f) of the Internal Revenue Code, the insurer shall offer the policy and certificate holders the option to convert, on a guaranteed-issue basis, to a policy or certificate that is federally tax qualified if the insurer sells tax-qualified policies. (e) It is the intent of the Legislature that the commissioner approve by July 1, 2001, all accurate and complete contracts submitted for approval pursuant to subdivision (b). It is the further intent of the Legislature that insurers submit contracts for approval and resolve further outstanding issues pursuant to subdivision (b) in a timely manner in order for the commissioner to approve the contracts by July 1, 2001. (Amended (as amended by Stats. 1999, Ch. 947) by Stats. 2001, Ch. 51, Sec. 3. Effective July 9, 2001.)
  63. 10232.3.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    Long-term care insurance applications must use clear, simple health questions, include a required checklist, and certain disclosures and records must be handled by insurers; field issuing is prohibited.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.3. (a) All applications for long-term care insurance except that which is guaranteed issue, shall contain clear, unambiguous, short, simple questions designed to ascertain the health condition of the applicant. Each health-related question shall contain only one health status inquiry and shall require only a “yes” or “no” answer, except that the application may include a request for the name of any prescribed medication and the name of a prescribing physician. If the application requests the name of any prescribed medication or prescribing physician, then any mistake or omission shall not be used as a basis for the denial of a claim or the rescission of a policy or certificate. (b) The following warning shall be printed conspicuously and in close conjunction with the applicant’s signature block: “Caution: If your answers on this application are misstated or untrue, the insurer may have the right to deny benefits or rescind your coverage.” (c) Every application for long-term care insurance shall include a checklist that enumerates each of the specific documents that this chapter requires be given to the applicant at the time of solicitation. The documents and notices to be listed in the checklist include, but are not limited to, the following: (1) The outline of coverage pursuant to Section 10233.5. (2) The HICAP notice pursuant to paragraph (8) of subdivision (a) of Section 10234.93. (3) The long-term care insurance shoppers guide pursuant to paragraph (9) of subdivision (a) of Section 10234.93. (4) The “Long-Term Care Insurance Personal Worksheet” pursuant to subdivision (c) of Section 10234.95. (5) The “Notice to Applicant Regarding Replacement of Accident and Sickness or Long-Term Care Insurance” pursuant to Section 10235.16 if replacement is not made by direct response solicitation or Section 10235.18 if replacement is made by direct response solicitation. Unless the solicitation was made by a direct response method, the agent and applicant shall both sign at the bottom of the checklist to indicate the required documents were delivered and received. (d) If an insurer does not complete medical underwriting and resolve all reasonable questions arising from information submitted on or with an application before issuing the policy or certificate, then the insurer may only rescind the policy or certificate or deny an otherwise valid claim, upon clear and convincing evidence of fraud or material misrepresentation of the risk by the applicant. The evidence shall: (1) Pertain to the condition for which benefits are sought. (2) Involve a chronic condition or involve dates of treatment before the date of application. (3) Be material to the acceptance for coverage. (e) No long-term care policy or certificate may be field issued. (f) The contestability period as defined in Section 10350.2 for long-term care insurance shall be two years. (g) A copy of the completed application shall be delivered to the insured at the time of delivery of the policy or certificate. (h) Every insurer shall maintain a record, in accordance with Section 10508, of all policy or certificate rescissions, both state and countrywide, and shall annually furnish this information to the commissioner, which shall include the reason for rescission, the length of time the policy or certificate was in force, and the age and gender of the insured person, in a format prescribed by the commissioner. (i) The commissioner may, in his or her discretion, make public the aggregate data collected under subdivision (h), upon request. (Amended by Stats. 2018, Ch. 98, Sec. 2. (AB 2180) Effective January 1, 2019.)
  64. 10232.4.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    Long-term care insurance policies generally cannot use overly restrictive preexisting-condition definitions and must cover disclosed preexisting conditions within six months, subject to stated exceptions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.4. (a) No long-term care insurance policy or certificate other than a group policy or certificate, as described in subdivision (a) of Section 10231.6, shall use a definition of preexisting condition which is more restrictive than a condition for which medical advice or treatment was recommended by, or received from a provider of health care services, within six months preceding the effective date of coverage of an insured person. (b) Every long-term care insurance policy or certificate shall cover preexisting conditions that are disclosed on the application no later than six months following the effective date of the coverage of an insured, regardless of the date the loss or confinement begins. (c) The definition of preexisting condition does not prohibit an insurer from using an application form designed to elicit the complete health history of an applicant, and on the basis of the answers on that application, from underwriting in accordance with that insurer’s established underwriting standards. Unless otherwise provided in the policy or certificate a preexisting condition, regardless of whether it is disclosed on the application, need not be covered until the waiting period described in subdivision (b) expires. Unless a waiver or rider has been specifically approved by the commissioner, no long-term care insurance policy or certificate may exclude or use waivers or riders of any kind to exclude, limit, or reduce coverage or benefits for specifically named or described preexisting diseases or physical conditions beyond the waiting period described in subdivision (b). (Amended by Stats. 1999, Ch. 947, Sec. 4. Effective January 1, 2000.)
  65. 10232.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    From January 1, 1990, a long-term care insurance policy may not be delivered or issued for delivery in this state if it makes benefits or eligibility depend on the listed prior hospitalization or institutional-care conditions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.5. On or after January 1, 1990, no long-term care insurance policy may be delivered or issued for delivery in this state which does any of the following: (a) Preconditions the availability of benefits on prior hospitalization. (b) Conditions eligibility for benefits provided in an institutional care setting on the receipt of a higher level of institutional care. (c) Preconditions the availability of benefits for community-based care, home health care, or home care on prior institutionalization. (d) Conditions eligibility for noninstitutional benefits, other than those in subdivision (c), on a prior institutional stay of more than 30 days. (Repealed and added by Stats. 1989, Ch. 1273, Sec. 4.2.)
  66. 10232.6.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    The commissioner may adopt regulations for long-term care insurance loss ratio standards, but the regulation must specifically reference long-term care insurance policies.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.6. The commissioner may adopt regulations establishing loss ratio standards for long-term care insurance policies provided that a specific reference to long-term care insurance policies is contained in the regulation. Any regulations adopted by the commissioner shall substantially reflect the loss ratio standards contained in Section 10 of the National Association of Insurance Commissioners Long-Term Care Insurance Model Regulations, as most recently revised. (Added by Stats. 1988, Ch. 1342, Sec. 1.)
  67. 10232.65.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    For long-term care insurance policies, the insurer is limited in how much premium it can require up front and must notify the applicant within 60 days.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.65. In addition to any other requirements of law, the following shall apply to a long-term care insurance policy: (a) The insurer shall not require an amount greater than one month’s premium to be submitted with an application for the policy of insurance if interim coverage is not provided. If interim coverage is provided, the insurer shall not require an amount greater than two months’ premium for that purpose. No further premiums may be collected until the policy is delivered to the applicant. (b) The insurer shall notify the applicant within 60 days from the date the insurer or insurer’s authorized representative or producer receives the application and the amount as to whether or not the applicant will be issued a policy of insurance. If the applicant is not so notified, the insurer or insurer’s authorized representative or producer shall pay interest to the applicant on the funds that the applicant submitted with the application, at the legal rate of interest on judgments as provided in Section 685.010 of the Code of Civil Procedure, from the date the insurer or insurer’s authorized representative or producer received those funds until they are refunded to the applicant or are applied toward the premium. (Added by Stats. 2001, Ch. 328, Sec. 5. Effective January 1, 2002.)
  68. 10232.7.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    Some applicants for long-term care insurance policies or certificates may return the policy within 30 days of delivery and get a refund if they are not satisfied; the insurer must refund premiums and fees and include a prominent notice about this right.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.7. (a) An applicant for a long-term care insurance policy or a certificate, other than an applicant for a certificate issued under a group long-term care insurance policy issued to a group as described in subdivisions (a) and (b) of Section 10231.6, shall have the right to return the policy or certificate by first-class United States mail within 30 days of its delivery and to have the premium refunded if, after examination of the policy or certificate, the applicant is not satisfied for any reason. (b) The return of a policy or certificate shall void the policy or certificate from the beginning and the parties shall be in the same position as if no policy, certificate, or contract had been issued. All premiums paid and any policy fee paid for the policy shall be fully refunded directly to the applicant by the insurer within 30 days after the policy or certificate is returned. (c) Notwithstanding Section 10276 or any other law, long-term care insurance policies or certificates to which this section applies shall have a notice prominently printed on the first page of the policy or certificate, or attached thereto, stating in substance the conditions described in subdivisions (a) and (b). (Amended by Stats. 1989, Ch. 1273, Sec. 5.)
  69. 10232.8.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    This section sets minimum eligibility standards and definitions for long-term care home care benefits, and it requires certain certifications, review rights, and policy features for covered policies.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.8. (a) In every long-term care policy or certificate that is not intended to be a federally qualified long-term care insurance contract and provides home care benefits, the threshold establishing eligibility for home care benefits shall be at least as permissive as a provision that the insured will qualify if either one of two criteria are met: (1) Impairment in two out of seven activities of daily living. (2) Impairment of cognitive ability. The policy or certificate may provide for lesser but not greater eligibility criteria. The commissioner, at his or her discretion, may approve other criteria or combinations of criteria to be substituted, if the insurer demonstrates that the interest of the insured is better served. “Activities of daily living” in every policy or certificate that is not intended to be a federally qualified long-term care insurance contract and provides home care benefits shall include eating, bathing, dressing, ambulating, transferring, toileting, and continence; “impairment” means that the insured needs human assistance, or needs continual substantial supervision; and “impairment of cognitive ability” means deterioration or loss of intellectual capacity due to organic mental disease, including Alzheimer’s disease or related illnesses, that requires continual supervision to protect oneself or others. (b) In every long-term care policy approved or certificate issued after the effective date of the act adding this section, that is intended to be a federally qualified long-term care insurance contract as described in subdivision (a) of Section 10232.1, the threshold establishing eligibility for home care benefits shall provide that a chronically ill insured will qualify if either one of two criteria are met or if a third criterion, as provided by this subdivision, is met: (1) Impairment in two out of six activities of daily living. (2) Impairment of cognitive ability. Other criteria shall be used in establishing eligibility for benefits if federal law or regulations allow other types of disability to be used applicable to eligibility for benefits under a long-term care insurance policy. If federal law or regulations allow other types of disability to be used, the commissioner shall promulgate emergency regulations to add those other criteria as a third threshold to establish eligibility for benefits. Insurers shall submit policies for approval within 60 days of the effective date of the regulations. With respect to policies previously approved, the department is authorized to review only the changes made to the policy. All new policies approved and certificates issued after the effective date of the regulation shall include the third criterion. A policy shall not be sold unless the policy includes the third criterion after one year beyond the effective date of the regulations. An insured meeting this third criterion shall be eligible for benefits regardless of whether the individual meets the impairment requirements in paragraph (1) or (2) regarding activities of daily living and cognitive ability. (c) A licensed health care practitioner, independent of the insurer, shall certify that the insured meets the definition of “chronically ill individual” as defined under Public Law 104-191. For the purposes of long-term care insurance as defined in Section 10231.2, an insurer shall not impose a certification requirement of longer than 90 days. The policy or certificate shall explain paragraphs (1) through (5) and comply with all of the following: (1) An insured has the option of submitting a certification to the insurer or submitting a notice of claim and requesting that the insurer conduct the assessment. If the insured requests that the insurer conduct the assessment, the insurer shall provide an independent licensed health care practitioner to conduct the assessment. If a health care practitioner makes a determination, pursuant to this section, that an insured does not meet the definition of “chronically ill individual,” the insurer shall notify the insured that the insured shall be entitled to a second assessment by a licensed health care practitioner, upon request, who shall personally examine the insured. The requirement for a second assessment shall not apply if the initial assessment was performed by a practitioner who otherwise meets the requirements of this section and who personally examined the insured. (2) The assessments conducted pursuant to this section shall be performed promptly with the certification completed as quickly as possible to ensure that an insured’s benefits are not delayed. The written certification shall be renewed every 12 months. (3) A licensed health care practitioner shall develop a written plan of care after personally examining the insured. (4) The costs to have a licensed health care practitioner certify that an insured meets, or continues to meet, the definition of “chronically ill individual,” or to prepare written plans of care shall not count against the lifetime maximum of the policy or certificate. (5) In order to be considered “independent of the insurer,” a licensed health care practitioner shall not be an employee of the insurer and shall not be compensated in any manner that is linked to the outcome of the certification. (6) It is the intent of this subdivision that the practitioner’s assessments be unhindered by financial considerations. (7) This subdivision shall apply only to a policy or certificate intended to be a federally qualified long-term care insurance contract. (d) “Activities of daily living” in every policy or certificate intended to be a federally qualified long-term care insurance contract as provided by Public Law 104-191 shall include eating, bathing, dressing, transferring, toileting, and continence; “impairment in activities of daily living” means the insured needs “substantial assistance” either in the form of “hands-on assistance” or “standby assistance,” due to a loss of functional capacity to perform the activity; “impairment of cognitive ability” means the insured needs substantial supervision due to severe cognitive impairment; “licensed health care practitioner” means a physician, registered nurse, licensed social worker, or other individual whom the United States Secretary of the Treasury may prescribe by regulation; and “plan of care” means a written description of the insured’s needs and a specification of the type, frequency, and providers of all formal and informal long-term care services required by the insured, and the cost, if any. (e) Until the time that these definitions may be superseded by federal law or regulation, the terms “substantial assistance,” “hands-on assistance,” “standby assistance,” “severe cognitive impairment,” and “substantial supervision” shall be defined according to the safe-harbor definitions contained in Internal Revenue Service Notice 97-31, issued May 6, 1997. (f) The definitions of “activities of daily living” to be used in policies and certificates that are intended to be federally qualified long-term care insurance shall be the following until the time that these definitions may be superseded by federal law or regulations: (1) Eating, which shall mean feeding oneself by getting food in the body from a receptacle (such as a plate, cup, or table) or by a feeding tube or intravenously. (2) Bathing, which shall mean washing oneself by sponge bath or in either a tub or shower, including the act of getting into or out of a tub or shower. (3) Continence, which shall mean the ability to maintain control of bowel and bladder function; or when unable to maintain control of bowel or bladder function, the ability to perform associated personal hygiene (including caring for a catheter or colostomy bag). (4) Dressing, which shall mean putting on and taking off all items of clothing and any necessary braces, fasteners, or artificial limbs. (5) Toileting, which shall mean getting to and from the toilet, getting on or off the toilet, and performing associated personal hygiene. (6) Transferring, which shall mean the ability to move into or out of bed, a chair, or wheelchair. The commissioner may approve the use of definitions of “activities of daily living” that differ from the verbatim definitions of this subdivision if these definitions would result in more policy or certificate holders qualifying for long-term care benefits than would occur by the use of the verbatim definitions of this subdivision. In addition, the following definitions may be used without the approval of the commissioner: (1) the verbatim definitions of eating, bathing, dressing, toileting, transferring, and continence in subdivision (g); or (2) the verbatim definitions of eating, bathing, dressing, toileting, and continence in this subdivision and a substitute, verbatim definition of “transferring” as follows: “transferring,” which shall mean the ability to move into and out of a bed, a chair, or wheelchair, or ability to walk or move around inside or outside the home, regardless of the use of a cane, crutches, or braces. The definitions to be used in policies and certificates for impairment in activities of daily living, “impairment in cognitive ability,” and any third eligibility criterion adopted by regulation pursuant to subdivision (b) shall be the verbatim definitions of these benefit eligibility triggers allowed by federal regulations. In addition to the verbatim definitions, the commissioner may approve additional descriptive language to be added to the definitions, if the additional language is (1) warranted based on federal or state laws, federal or state regulations, or other relevant federal decision, and (2) strictly limited to that language that is necessary to ensure that the definitions required by this section are not misleading to the insured. (g) The definitions of “activities of daily living” to be used verbatim in policies and certificates that are not intended to qualify for favorable tax treatment under Public Law 104-191 shall be the following: (1) Eating, which shall mean reaching for, picking up, and grasping a utensil and cup; getting food on a utensil, and bringing food, utensil, and cup to mouth; manipulating food on plate; and cleaning face and hands as necessary following meals. (2) Bathing, which shall mean cleaning the body using a tub, shower, or sponge bath, including getting a basin of water, managing faucets, getting in and out of tub or shower, and reaching head and body parts for soaping, rinsing, and drying. (3) Dressing, which shall mean putting on, taking off, fastening, and unfastening garments and undergarments and special devices such as back or leg braces, corsets, elastic stockings or garments, and artificial limbs or splints. (4) Toileting, which shall mean getting on and off a toilet or commode and emptying a commode, managing clothing and wiping and cleaning the body after toileting, and using and emptying a bedpan and urinal. (5) Transferring, which shall mean moving from one sitting or lying position to another sitting or lying position; for example, from bed to or from a wheelchair or sofa, coming to a standing position, or repositioning to promote circulation and prevent skin breakdown. (6) Continence, which shall mean the ability to control bowel and bladder as well as use ostomy or catheter receptacles, and apply diapers and disposable barrier pads. (7) Ambulating, which shall mean walking or moving around inside or outside the home regardless of the use of a cane, crutches, or braces. (Amended by Stats. 2018, Ch. 98, Sec. 3. (AB 2180) Effective January 1, 2019.)
  70. 10232.81.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    Certain long-term care policies, certificates, or riders must cover at least the listed long-term care services.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.81. Every long-term care policy, certificate, or rider that purports to provide benefits of home care, community-based services, and residential care facility services under the California Partnership for Long-Term Care Program established by Section 22000 of the Welfare and Institutions Code shall provide at least the following: (a) Care in a residential care facility. (b) Home health care. (c) Adult day care. (d) Personal care. (e) Homemaker services. (f) Hospice services. (g) Respite care. (Amended by Stats. 2018, Ch. 565, Sec. 2. (SB 1248) Effective January 1, 2019.)
  71. 10232.9.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    Certain long-term care policies must include specified home care benefits and meet minimum home care payment and duration rules.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.9. (a) Every long-term care policy or certificate that purports to provide benefits of home care or community-based services, shall provide at least the following: (1) Home health care. (2) Adult day care. (3) Personal care. (4) Homemaker services. (5) Hospice services. (6) Respite care. (b) For purposes of this section, policy definitions of these benefits may be no more restrictive than the following: (1) “Home health care” is skilled nursing or other professional services in the residence, including, but not limited to, part-time and intermittent skilled nursing services, home health aid services, physical therapy, occupational therapy, or speech therapy and audiology services, and medical social services by a social worker. (2) “Adult day care” is medical or nonmedical care on a less than 24-hour basis, provided in a licensed facility outside the residence, for persons in need of personal services, supervision, protection, or assistance in sustaining daily needs, including eating, bathing, dressing, ambulating, transferring, toileting, and taking medications. (3) “Personal care” is assistance with the activities of daily living, including the instrumental activities of daily living, provided by a skilled or unskilled person under a plan of care developed by a physician or a multidisciplinary team under medical direction. “Instrumental activities of daily living” include using the telephone, managing medications, moving about outside, shopping for essentials, preparing meals, laundry, and light housekeeping. (4) “Homemaker services” is assistance with activities necessary to or consistent with the insured’s ability to remain in his or her residence, that is provided by a skilled or unskilled person under a plan of care developed by a physician or a multidisciplinary team under medical direction. (5) “Hospice services” are outpatient services not paid by Medicare, that are designed to provide palliative care, alleviate the physical, emotional, social, and spiritual discomforts of an individual who is experiencing the last phases of life due to the existence of a terminal disease, and to provide supportive care to the primary care giver and the family. Care may be provided by a skilled or unskilled person under a plan of care developed by a physician or a multidisciplinary team under medical direction. (6) “Respite care” is short-term care provided in an institution, in the home, or in a community-based program, that is designed to relieve a primary care giver in the home. This is a separate benefit with its own conditions for eligibility and maximum benefit levels. (c) Home care benefits shall not be limited or excluded by any of the following: (1) Requiring a need for care in a nursing home if home care services are not provided. (2) Requiring that skilled nursing or therapeutic services be used before or with unskilled services. (3) Requiring the existence of an acute condition. (4) Limiting benefits to services provided by Medicare-certified providers or agencies. (5) Limiting benefits to those provided by licensed or skilled personnel when other providers could provide the service, except where prior certification or licensure is required by state law. (6) Defining an eligible provider in a manner that is more restrictive than that used to license that provider by the state where the service is provided. (7) Requiring “medical necessity” or similar standard as a criteria for benefits. (d) Every comprehensive long-term care policy or certificate that provides for both institutional care and home care and that sets a daily, weekly, or monthly benefit payment maximum, shall pay a maximum benefit payment for home care that is at least 50 percent of the maximum benefit payment for institutional care, and in no event shall home care benefits be paid at a rate less than fifty dollars ($50) per day. Insurance products approved for residents in continuing care retirement communities are exempt from this provision. Every such comprehensive long-term care policy or certificate that sets a durational maximum for institutional care, limiting the length of time that benefits may be received during the life of the policy or certificate, shall allow a similar durational maximum for home care that is at least one-half of the length of time allowed for institutional care. (Added by renumbering Section 10232.8 by Stats. 1997, Ch. 699, Sec. 4. Effective October 6, 1997.)
  72. 10232.92.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    Long-term care policies covering nursing-facility confinement must include residential care facility coverage and related benefit rules.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.92. Every long-term care policy or certificate covering confinement in a nursing facility shall also include a provision with the following features: (a) Care in a residential care facility must be covered. “Residential care facility” means a facility licensed as a residential care facility for the elderly or a residential care facility as defined in the Health and Safety Code. Outside California, eligible providers are facilities that meet applicable licensure standards, if any, and are engaged primarily in providing ongoing care and related services sufficient to support needs resulting from impairment in activities of daily living or impairment in cognitive ability and which also provide care and services on a 24-hour basis, have a trained and ready-to-respond employee on duty in the facility at all times to provide care and services, provide three meals a day and accommodate special dietary needs, have agreements to ensure that residents receive the medical care services of a physician or nurse in case of emergency, and, have appropriate methods and procedures to provide necessary assistance to residents in the management of prescribed medications. (b) The benefit amount payable for care in a residential care facility shall be no less than 70 percent of the benefit amount payable for institutional confinement. (c) All expenses incurred by the insured while confined in a residential care facility, for long-term care services that are necessary diagnostic, preventative, therapeutic, curing, treating, mitigating, and rehabilitative services, and maintenance or personal care services, needed to assist the insured with the disabling conditions that cause the insured to be a chronically ill individual as authorized by Public Law 104-191 and regulations adopted pursuant thereto, shall be covered and payable, up to but not to exceed the maximum daily residential care facility benefit of the policy or certificate. There shall be no restriction on who may provide the service or the requirement that services be provided by the residential care facility, as long as the expenses are incurred while the insured is confined in a residential care facility, the reimbursement does not exceed the maximum daily residential care facility benefit of the policy or certificate, and the services do not conflict with federal law or regulation for purposes of qualifying for favorable tax consideration provided by Public Law 104-191. (d) In policies or certificates that are not intended to be federally qualified, the threshold establishing eligibility for care in a residential care facility shall be no more restrictive than that for home care benefits, as defined in subdivision (a) of Section 10232.8, and the definitions of impairment in activities of daily living and impairment of cognitive ability shall be the same as for home care benefits, as defined in subdivisions (a) and (g) of Section 10232.8. In policies or certificates that are intended to be federally qualified, the threshold establishing eligibility for care in a residential care facility shall be no more restrictive than that for home care benefits, as defined in subdivision (b) of Section 10232.8, and the definitions of impairment in activities of daily living and impairment in cognitive ability shall be the same as those for home care benefits as defined in subdivisions (b), (c), (d), (e), and (f) of Section 10232.8. (Repealed and added by Stats. 1999, Ch. 947, Sec. 6. Effective January 1, 2000.)
  73. 10232.93.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    Long-term care policies or certificates must state the maximum lifetime benefit as one dollar amount that can be used across covered care types.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.93. Every long-term care policy or certificate shall define the maximum lifetime benefit as a single dollar amount that may be used interchangeably for any home- and community-based services defined in Section 10232.9, assisted living benefit defined in Section 10232.92, or institutional care covered by the policy or certificate. There shall be no limit on any specific covered benefit except for a daily, weekly, or monthly limit set for home- and community-based care and for assisted living care, and for the limits for institutional care. Nothing in this section shall be construed as prohibiting limitations for reimbursement of actual expenses and incurred expenses up to daily, weekly, and monthly limits. (Added by Stats. 1997, Ch. 699, Sec. 6. Effective October 6, 1997.)
  74. 10232.95.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    Long-term care policies or certificates that reimburse nursing-facility care must cover and reimburse per diem expenses and ancillary supplies and services, subject to the policy’s maximum lifetime daily facility benefit.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.95. Every long-term care policy or certificate that provides reimbursement for care in a nursing facility shall cover and reimburse for per diem expenses, as well as the costs of ancillary supplies and services, up to but not to exceed the maximum lifetime daily facility benefit of the policy or certificate. (Added by Stats. 1997, Ch. 699, Sec. 6.3. Effective October 6, 1997.)
  75. 10232.96.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    If a pre-December 31, 1996 insurance contract holder requests a material modification, the insurer must give written notice before approving it.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.96. When a policy or certificate holder of an insurance contract issued prior to December 31, 1996, requests a material modification to the contract as defined by federal law or regulations, the insurer, prior to approving such a request, shall provide written notice to the policy or certificate holder that the contract change requested may constitute a material modification that jeopardizes the federal tax status of the contract and appropriate tax advice should therefore be sought. (Added by Stats. 1997, Ch. 699, Sec. 6.5. Effective October 6, 1997.)
  76. 10232.97.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    Long-term care policies or certificates covering nursing facility care must set an eligibility threshold that is no more restrictive than qualifying based on either two activities of daily living or cognitive impairment.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10232.97. In every long-term care policy or certificate that covers care in a nursing facility, the threshold establishing eligibility for nursing facility care shall be no more restrictive than a provision that the insured will qualify if either one of two criteria are met: (a) Impairment in two activities of daily living. (b) Impairment in cognitive ability. (Added by Stats. 1999, Ch. 947, Sec. 7. Effective January 1, 2000.)
  77. 10233.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    An insurer offering long-term care insurance may obtain a written declaration that services are necessary before paying benefits for covered care.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10233. Precedent to the payment of benefits for any care covered by the terms of the policy, any insurer offering long-term care insurance as described in Section 10231.2 may obtain a written declaration by a physician, independent needs assessment agency, or any other source of independent judgment suitable to the insurer that services are necessary. (Added by Stats. 1989, Ch. 1273, Sec. 7.)
  78. 10233.2.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    Long-term care insurance policies may not cancel or limit coverage for certain reasons, add a new waiting period in a same-insurer conversion or replacement, favor skilled nursing coverage over lower levels of care, use certain benefit-payment standards, increase premiums because of divorce, or add certain extra benefits unless specific conditions are met.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10233.2. Long-term care insurance may not: (a) Be canceled, nonrenewed, or otherwise terminated on the grounds of the age or the deterioration of the mental or physical health of the insured individual or certificate holder. (b) Contain a provision establishing a new waiting period in the event existing coverage is converted to, or replaced by, a new or other form within the same insurer, except with respect to an increase in benefits voluntarily selected by the insured individual or group policyholder. (c) Provide coverage for skilled nursing care only or provide significantly more coverage for skilled care in a facility than coverage for lower levels of care. (d) Provide for payment of benefits based on a standard described as “usual and customary,” “reasonable and customary,” or words of similar import. (e) Terminate a policy, certificate, or rider, or contain a provision that allows the premium for an in-force policy, certificate, or rider, to be increased due to the divorce of a policyholder or certificate holder. (f) Include an additional benefit for a service with a known market value other than the statutorily required home- and community-based service benefits in Section 10232.9, the assisted living benefit in Section 10232.92, or a nursing facility benefit, unless the additional benefit provides for the payment of at least five times the daily benefit and the dollar value of the additional benefit is disclosed in the schedule page of the policy. (Amended by Stats. 1999, Ch. 947, Sec. 8. Effective January 1, 2000.)
  79. 10233.25.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    A long-term care policy or certificate issued, amended, renewed, or delivered on or after January 1, 2002, may not include a term that blocks or limits health facilities’ compliance with Section 1262.5 of the Health and Safety Code.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10233.25. No long-term care policy or certificate that is issued, amended, renewed, or delivered on and after January 1, 2002, shall contain a provision that prohibits or restricts any health facilities’ compliance with the requirements of Section 1262.5 of the Health and Safety Code. (Added by Stats. 2001, Ch. 691, Sec. 7. Effective January 1, 2002.)
  80. 10233.3.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    When a long-term care policy or certificate replaces another one, the replacing insurer must waive waiting periods for preexisting conditions and probationary periods if similar exclusions were already satisfied under the original policy.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10233.3. If a policy or certificate replaces another long-term care policy or certificate, the replacing insurer shall waive any time periods applicable to preexisting conditions and probationary periods to the extent that similar exclusions have been satisfied under the original policy or certificate. (Added by Stats. 1992, Ch. 1132, Sec. 14. Effective January 1, 1993.)
  81. 10233.4.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    Long-term care insurance benefits may not be reduced because of out-of-pocket spending by the insured, a family member, or another individual on the insured’s behalf.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10233.4. No long-term care insurance benefits may be reduced because of out-of-pocket expenditures by the insured or on behalf of the insured by a family member of the insured or by any other individual. (Added by Stats. 1989, Ch. 1273, Sec. 9.)
  82. 10233.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    This section requires a long-term care insurance outline of coverage to be delivered or presented at specified times and in a prescribed form.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10233.5. (a) An outline of coverage shall be delivered to a prospective applicant for long-term care insurance at the time of initial solicitation through means which prominently direct the attention of the recipient to the document and its purpose. (b) In the case of agent solicitations, an agent shall deliver the outline of coverage prior to the presentation of an application or enrollment form. (c) In the case of direct response solicitations, the outline of coverage shall be presented in conjunction with any application or enrollment form. (d) The outline of coverage shall be a freestanding document, using no smaller than 10-point type. (e) The outline of coverage shall contain no material of an advertising nature. (f) Use of the text and sequence of the text of the outline of coverage set forth in this section is mandatory, unless otherwise specifically indicated. (g) Text which is capitalized or underscored in the outline of coverage may be emphasized by other means which provide prominence equivalent to capitalization or underscoring. (h) The outline of coverage shall be in the following form: ## “(COMPANY NAME) (ADDRESS—CITY AND STATE) (TELEPHONE NUMBER) LONG-TERM CARE INSURANCE OUTLINE OF COVERAGE (Policy Number or Group Master Policy and Certificate Number) 1.This policy is (an individual policy of insurance) ((a group policy) which was issued in the (indicate jurisdiction in which group policy was issued)). 2.PURPOSE OF OUTLINE OF COVERAGE. This outline of coverage provides a very brief description of the important features of the policy. You should compare this outline of coverage to outlines of coverage for other policies available to you. This is not an insurance contract, but only a summary of coverage. Only the individual or group policy contains governing contractual provisions. This means that the policy or group policy sets forth in detail the rights and obligations of both you and the insurance company. Therefore, if you purchase this coverage, or any other coverage, it is important that you READ YOUR POLICY (OR CERTIFICATE) CAREFULLY! 3.TERMS UNDER WHICH THE POLICY OR CERTIFICATE MAY BE RETURNED AND PREMIUM REFUNDED. (a) Provide a brief description of the right to return—“free look” provision of the policy. (b) Include a statement that the policy either does or does not contain provisions providing for a refund or partial refund of premium upon the death of an insured or surrender of the policy or certificate. If the policy contains those provisions, include a description of them. 4.THIS IS NOT MEDICARE SUPPLEMENT COVERAGE. If you are eligible for Medicare, review the Medicare Supplement Buyer’s Guide available from the insurance company. (a) (For agents) Neither (insert company name) nor its agents represent Medicare, the federal government or any state government. (b) (For direct response) (insert company name) is not representing Medicare, the federal government or any state government. 5.LONG-TERM CARE COVERAGE. Policies of this category are designed to provide coverage 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, such as in a nursing home, in the community, or in the home. This policy provides coverage in the form of a fixed dollar indemnity benefit for covered long-term care expenses, subject to policy (limitations) (waiting periods) and (coinsurance) requirements. (Modify this paragraph if the policy is not an indemnity policy.) 6.BENEFITS PROVIDED BY THIS POLICY. (a) (Covered services, related deductible(s), waiting periods, elimination periods, and benefit maximums.) (b) (Institutional benefits, by skill level.) (c) (Noninstitutional benefits, by skill level.) (Any benefit screens must be explained in this section. If these screens differ for different benefits, explanation of the screen should accompany each benefit description. If an attending physician or other specified person must certify a certain level of functional dependency in order to be eligible for benefits, this too must be specified. If activities of daily living (ADLs) are used to measure an insured’s need for long-term care, then these qualifying criteria or screens must be explained.) 7.LIMITATIONS AND EXCLUSIONS. (Describe: (a) Preexisting conditions. (b) Noneligible facilities/provider. (c) Noneligible levels of care (e.g., unlicensed providers, care or treatments provided by a family member, etc.). (d) Exclusions/exceptions. (e) Limitations.) (This section should provide a brief specific description of any policy provisions which limit, exclude, restrict, reduce, delay, or in any other manner operate to qualify payment of the benefits described in (6) above.) THIS POLICY MAY NOT COVER ALL THE EXPENSES ASSOCIATED WITH YOUR LONG-TERM CARE NEEDS. 8.RELATIONSHIP OF COST OF CARE AND BENEFITS. Because the costs of long-term care services will likely increase over time, you should consider whether and how the benefits of this plan may be adjusted. (As applicable, indicate the following: (a) That the benefit level will NOT increase over time. (b) Any automatic benefit adjustment provisions. (c) Whether the insured will be guaranteed the option to buy additional benefits and the basis upon which benefits will be increased over time if not by a specified amount or percentage. (d) If there is a guarantee, include whether additional underwriting or health screening will be required, the frequency and amounts of the upgrade options, and any significant restrictions or limitations. (e) And finally, describe whether there will be any additional premium charge imposed, and how that is to be calculated.) 9.TERMS UNDER WHICH THE POLICY (OR CERTIFICATE) MAY BE CONTINUED IN FORCE OR DISCONTINUED. (a) Describe the policy renewability provisions. (b) For group coverage, specifically describe continuation/conversion provisions applicable to the certificate and group policy. (c) Describe waiver of premium provisions or state that there are no waiver of premium provisions. (d) State whether or not the company has a right to change premium, and if that right exists, describe clearly and concisely each circumstance under which the premium may change. 10.ALZHEIMER’S DISEASE, ORGANIC DISORDERS, AND RELATED MENTAL DISEASES. (State that the policy provides coverage for insureds clinically diagnosed as having Alzheimer’s Disease, organic disorders, or related degenerative and dementing illnesses. Specifically describe each benefit screen or other policy provision that provides preconditions to the availability of policy benefits for that insured.) 11.PREMIUM. (a) State the total annual premium for the policy. (b) If the premium varies with an applicant’s choice among benefit options, indicate the portion of annual premium which corresponds to each benefit option. 12.ADDITIONAL FEATURES. (a) Indicate if medical underwriting is used. (b) Describe other important features. 13.INFORMATION AND COUNSELING. The California Department of Insurance has prepared a Consumer Guide to Long-Term Care Insurance. This guide can be obtained by calling the Department of Insurance toll-free telephone number. This number is 1-800-927-HELP. Additionally, the Health Insurance Counseling and Advocacy Program (HICAP) administered by the California Department of Aging, provides long-term care insurance counseling to California senior citizens. Call the HICAP toll-free telephone number 1-800-434-0222 for a referral to your local HICAP office.” (Amended by Stats. 1999, Ch. 947, Sec. 9. Effective January 1, 2000.)
  83. 10233.6.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    A certificate under a group long-term care insurance policy delivered or issued for delivery in this state must include specified policy information and rights explanations.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10233.6. A certificate issued pursuant to a group long-term care insurance policy, which policy is delivered or issued for delivery in this state, shall include all of the following: (a) A description of the principal benefits and coverage provided in the policy. (b) A statement of the principal exclusions, reductions, and limitations contained in the policy. (c) A statement of the terms under which the policy or certificate, or both, may be continued in force or discontinued, including any reservation in the policy of a right to change premiums. (d) A statement that the group master policy determines governing contractual provisions. (e) An explanation of the insured’s rights regarding continuation, conversion, and replacement. (Amended by Stats. 1992, Ch. 1132, Sec. 16. Effective January 1, 1993.)
  84. 10233.7.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    A policy cannot be advertised, marketed, or offered as long-term care or nursing home insurance unless it complies with this chapter.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10233.7. No policy may be advertised, marketed, or offered as long-term care or nursing home insurance unless it complies with this chapter. (Added by Stats. 1989, Ch. 1273, Sec. 12.)
  85. 10233.8.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. )

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    Long-term care insurance policies or certificates must not treat a living organ donor worse just because of donor status, if issued, amended, renewed, or delivered on or after January 1, 2020.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3. General Provisions [10232 - 10233.8] ( Article 3 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## 10233.8. (a) A long-term care insurance policy or certificate issued, amended, renewed, or delivered on or after January 1, 2020, shall not do any of the following based solely and without any additional actuarial risks upon the status of a person as a living organ donor: (1) Refuse to insure, or refuse to continue to insure, the person under a long-term care insurance policy or certificate. (2) Limit the amount, extent, or kind of coverage available to the person under a long-term care insurance policy or certificate. (3) Charge the person a different rate for the same coverage under a long-term care insurance policy or certificate. (4) Otherwise discriminate in the offering, issuance, cancellation, amount of coverage, price, or any other condition of a long-term care insurance policy or certificate for the person. (b) With respect to any health condition other than being a living organ donor, a person who is a living organ donor shall be subject to the same standards of sound actuarial principles or actual or reasonably anticipated experience as persons who are not living organ donors. (c) For purposes of this section, “living organ donor” means an individual who has donated all or part of an organ and is not deceased. (Added by Stats. 2019, Ch. 316, Sec. 5. (AB 1223) Effective January 1, 2020.)
  86. 10234.8.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. )

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    For long-term care insurance, insurers, brokers, agents, and others in the insurance business owe policyholders and prospective policyholders duties of honesty and good faith and fair dealing.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. ) ## 10234.8. (a) With regard to long-term care insurance, all insurers, brokers, agents, and others engaged in the business of insurance owe a policyholder or a prospective policyholder a duty of honesty, and a duty of good faith and fair dealing. (b) Conduct of an insurer, broker, or agent during the offer and sale of a policy previous to the purchase is relevant to any action alleging a breach of the duty of honesty, and a duty of good faith and fair dealing. (Amended by Stats. 2000, Ch. 442, Sec. 4. Effective January 1, 2001.)
  87. 10234.85.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. )

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    An insurer, broker, agent, or other person must not cause a policyholder to unnecessarily replace a long-term care insurance policy.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. ) ## 10234.85. No insurer, broker, agent, or other person shall cause a policyholder to replace a long term care insurance policy unnecessarily. Nothing in this section shall be construed to allow an insurer, broker, agent, or other person to cause a policyholder to replace a long term care insurance policy that will result in a decrease in benefits and an increase in premium. It shall be presumed that any third or greater policy sold to a policyholder in any 12-month period is unnecessary within the meaning of this section. This section shall not apply to those instances in which a policy is replaced solely for the purpose of consolidating policies with a single insurer. (Added by Stats. 1989, Ch. 631, Sec. 1.)
  88. 10234.86.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. )

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    Insurers must keep records on agent replacement and lapse rates for long-term care insurance and file annual reports by June 30 with specified statewide statistics.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. ) ## 10234.86. (a) Every insurer shall maintain records for each agent of that agent’s amount of replacement sales as a percent of the agent’s total annual sales and the amount of lapses of long-term care insurance policies sold by the agent as a percent of the agent’s total annual sales. (b) Every insurer shall report annually by June 30, the 10 percent of its agents in the state with the greatest percentage of lapses and replacements as measured by subdivision (a). (c) Every insurer shall report annually by June 30, the number of lapsed policies as a percent of its total annual sales in the state, as a percent of its total number of policies in force in the state, and as a total number of each policy form in the state, as of the end of the preceding calendar year. (d) Every insurer shall report annually by June 30, the number of replacement policies sold as a percent of its total annual sales in the state and as a percent of its total number of policies in force in the state as of the end of the preceding calendar year. (e) Reported replacement and lapse rates do not alone constitute a violation of insurance laws or imply wrongdoing. The reports are for the purpose of reviewing more closely agent activities regarding the sale of long-term care insurance. (Amended by Stats. 2011, Ch. 426, Sec. 7. (SB 712) Effective January 1, 2012.)
  89. 10234.87.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. )

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    When an insurer replaces a policy or certificate it previously issued, it must give premium credits for past insured status, subject to limits and exceptions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. ) ## 10234.87. (a) If an insurer replaces a policy or certificate that it has previously issued, the insurer shall recognize past insured status by granting premium credits toward the premiums for the replacement policy or certificate. The premium credits shall equal five percent of the annual premium of the prior policy or certificate for each full year the prior policy or certificate was in force. The premium credit shall be applied toward all future premium payments for the replacement policy or certificate, but the cumulative credit allowed need not exceed 50 percent. No credit need be provided if a claim has been filed under the original policy or certificate. (b) The cumulative credits allowed need not reduce the premium for the replacement policy or certificate to less than the premium of the original policy or certificate. (c) This section shall not apply to life insurance policies that accelerate benefits for long-term care. (Amended by Stats. 1998, Ch. 1067, Sec. 5. Effective January 1, 1999.)
  90. 10234.9.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. )

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    Long-term care insurers in California must send ads to the commissioner 30 days before use, keep ads for at least three years, and certain ads and lead-based contacts must include specific disclosures.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. ) ## 10234.9. (a) Every insurer providing long-term care coverage in California shall provide a copy of any advertisement intended for use in California to the commissioner for review at least 30 days before dissemination. The advertisement shall comply with all laws in California. In addition, the advertisement shall be retained by the insurer in accordance with Section 10508 for at least three years. (b) An advertisement designed to produce leads must prominently disclose that “an insurance agent will contact you” if that is the case. (c) An agent, broker, or other person who contacts a consumer as a result of receiving information generated by a cold lead device, shall immediately disclose that fact to the consumer. (Repealed and added by Stats. 1992, Ch. 1132, Sec. 25. Effective January 1, 1993.)
  91. 10234.93.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. )

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    Long-term care insurers in California must set up marketing, training, disclosure, and compliance procedures, and certain marketing practices are prohibited.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. ) ## 10234.93. (a) Every insurer of long-term care in California shall: (1) Establish marketing procedures to ensure that any comparison of policies by its agents or other producers will be fair and accurate. (2) Establish marketing procedures to ensure excessive insurance is not sold or issued. (3) Submit to the commissioner within six months of the effective date of this act, a list of all agents or other insurer representatives authorized to solicit individual consumers for the sale of long-term care insurance. These submissions shall be updated at least semiannually. (4) Provide the following training and require that each agent or other insurer representative authorized to solicit individual consumers for the sale of long-term care insurance shall satisfactorily complete the following training requirements that, for resident licensees, shall count toward the licensee’s continuing education requirement, but may still result in completing more than the minimum number of continuing education hours set forth in this section: (A) For licensees issued a license after January 1, 1992, eight hours of training in each of the first four 12-month periods beginning from the date of original license issuance and thereafter eight hours of training prior to each license renewal. (B) For licensees issued a license before January 1, 1992, eight hours of training prior to each license renewal. (C) For nonresident licensees that are not otherwise subject to the continuing education requirements set forth in Section 1749.3, the evidence of training required by this section shall be filed with and approved by the commissioner as provided in subdivision (g) of Section 1749.4. Licensees shall complete the initial training requirements of this section prior to being authorized to solicit individual consumers for the sale of long-term care insurance. The training required by this section shall consist of topics related to long-term care services and long-term care insurance, including, but not limited to, California regulations and requirements, available long-term care services and facilities, changes or improvements in services or facilities, and alternatives to the purchase of private long-term care insurance. On or before July 1, 1998, the following additional training topics shall be required: differences in eligibility for benefits and tax treatment between policies intended to be federally qualified and those not intended to be federally qualified, the effect of inflation in eroding the value of benefits and the importance of inflation protection, and NAIC consumer suitability standards and guidelines. (5) Display prominently on page one of the policy or certificate and the outline of coverage: “Notice to buyer: This policy may not cover all of the costs associated with long-term care incurred by the buyer during the period of coverage. The buyer is advised to review carefully all policy limitations.” (6) Inquire and otherwise make every reasonable effort to identify whether a prospective applicant or enrollee for long-term care insurance already has accident and sickness or long-term care insurance and the types and amounts of any such insurance. (7) Every insurer or entity marketing long-term care insurance shall establish auditable procedures for verifying compliance with this subdivision. (8) Every insurer shall provide to a prospective applicant, at the time of solicitation, written notice that the Health Insurance Counseling and Advocacy Program (HICAP) provides health insurance counseling to senior California residents free of charge. Every agent shall provide the name, address, and telephone number of the local HICAP program and the statewide HICAP number, 1-800-434-0222. (9) Provide a copy of the long-term care insurance shoppers guide developed by the California Department of Aging to each prospective applicant prior to the presentation of an application or enrollment form for insurance. (10) Clearly post on its Internet Web site and provide written notice at the time of solicitation that a specimen individual policy form or group master policy and certificate form for each policy form offered in this state is available to a prospective applicant upon request. The individual specimen policy form or group master policy and certificate form shall be provided to a requesting party within 15 calendar days of receipt of a request. (b) In addition to other unfair trade practices, including those identified in this code, the following acts and practices are prohibited: (1) Twisting. Knowingly making any misleading representation, incomplete, or fraudulent comparison of any insurance policies or insurers for the purpose of inducing, or tending to induce, any person to lapse, forfeit, surrender, terminate, retain, pledge, assign, borrow on, or convert any insurance policy or to take out a policy of insurance with another insurer. (2) High pressure tactics. Using any method of marketing having the effect of or tending to induce the purchase of insurance through force, fright, threat, whether explicit or implied, or undue pressure to purchase or recommend the purchase of insurance. (3) Cold lead advertising. Making use directly or indirectly of any method of marketing that fails to disclose in a conspicuous manner that a purpose of the method of marketing is solicitation of insurance and that contact will be made by an insurance agent or insurance company. (Amended by Stats. 2014, Ch. 71, Sec. 102. (SB 1304) Effective January 1, 2015.)
  92. 10234.95.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. )

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    Insurers and agents selling long-term care insurance must use suitability standards, collect and handle applicant information, and follow worksheet and reporting rules.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. ) ## 10234.95. (a) Every insurer or other entity marketing long-term care insurance shall: (1) Develop and use suitability standards to determine whether the purchase or replacement of long-term care insurance is appropriate for the needs of the applicant. (2) Train its agents in the use of its suitability standards. (3) Maintain a copy of its suitability standards and make them available for inspection upon request by the commissioner. (b) The agent and insurer shall develop procedures that take into consideration, when determining whether the applicant meets the standards developed by the insurer, the following: (1) The ability to pay for the proposed coverage and other pertinent financial information related to the purchase of the coverage. (2) The applicant’s goals or needs with respect to long-term care and the advantages and disadvantages of insurance to meet these goals or needs. (3) The value, benefits, and costs of the applicant’s existing insurance, if any, when compared to the values, benefits, and costs of the recommended purchase or replacement. (c) (1) The issuer, and where an agent is involved, the agent, shall make reasonable efforts to obtain the information set out in subdivision (b). The efforts shall include presentation to the applicant, at or prior to application, of the “Long-Term Care Insurance Personal Worksheet,” contained in the Long-Term Care Insurance Model Regulations of the National Association of Insurance Commissioners. The personal worksheet used by the insurer shall contain, at a minimum, the information in the NAIC worksheet in not less than 12-point type. The insurer may request the applicant to provide additional information to comply with its suitability standards. (2) In the premium section of the personal worksheet, the insurer shall disclose all rate increases and rate increase requests for all policies, whether issued by the insurer or purchased or acquired from another insurer, in the United States for the current year and for nine preceding years. (3) The premium section shall include a statement that reads as follows: “A rate guide is available that compares the policies sold by different insurers, the benefits provided in those policies, and sample premiums. The rate guide also provides a history of the rate increases, if any, for the policies issued by different insurers in each state in which they do business, for the current year and for the nine preceding years. You can obtain a copy of this rate guide by calling the Department of Insurance’s consumer toll-free telephone number (1-800-927-HELP), by calling the Health Insurance Counseling and Advocacy Program (HICAP) toll-free telephone number (1-800-434-0222), or by accessing the Department of Insurance’s Internet Web site (www.insurance.ca.gov).” If the personal worksheet is approved prior to the availability of the rate guide, the worksheet shall indicate that the rate guide will be available beginning December 1, 2000. (4) A copy of the issuer’s personal worksheet shall be filed and approved by the commissioner. A new personal worksheet shall be filed and approved by the commissioner each time a rate is increased in California and each time a new policy is filed for approval by the commissioner. The new personal worksheet shall disclose the amount of the rate increase in California and all prior rate increases for the nine preceding years in California as well as all prior rate increases and rate increase requests or filings in any other state for the nine preceding years. The new personal worksheet shall be used by the insurer within 60 days of approval by the commissioner in place of the previously approved personal worksheet. (d) A completed personal worksheet shall be returned to the issuer prior to the issuer’s consideration of the applicant for coverage, except the personal worksheet need not be returned for sale of employer group long-term care insurance to employees and their spouses and dependents. (e) The sale or dissemination outside the company or agency by the issuer or agent of information obtained through the personal worksheet is prohibited. (f) The issuer shall use the suitability standards it has developed pursuant to this section in determining whether issuing long-term care insurance coverage to an applicant is appropriate. (g) Agents shall use the suitability standards developed by the insurer in marketing long-term care insurance. (h) If the issuer determines that the applicant does not meet its financial suitability standards, or if the applicant has declined to provide the information, the issuer may reject the application. Alternatively, the issuers shall send the applicant a letter similar to the “Long-Term Care Insurance Suitability Letter” contained in the Long-Term Care Model Regulations of the National Association of Insurance Commissioners. However, if the applicant has declined to provide financial information, the issuer may use some other method to verify the applicant’s intent. Either the applicant’s returned letter or a record of the alternative method of verification shall be made part of the applicant’s file. (i) The insurer shall report annually to the commissioner the total number of applications received from residents of this state, the number of those who declined to provide information on the personal worksheet, the number of applicants who did not meet the suitability standards, and the number who chose to conform after receiving a suitability letter. (j) This section shall not apply to life insurance policies that accelerate benefits for long-term care. (Amended by Stats. 2016, Ch. 304, Sec. 13. (AB 2884) Effective January 1, 2017.)
  93. 10234.97.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. )

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    Long-term care insurers must calculate replacement commissions using the premium difference and file commission information with the commissioner.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 3.7. Consumer Protection [10234.8 - 10234.97] ( Article 3.7 added by Stats. 1989, Ch. 631, Sec. 1. ) ## 10234.97. (a) Any time long-term care coverage is replaced, the sales commission that is paid by the insurer and that represents the percentage of the sale normally paid for first year sales of long-term care policies or certificates shall be calculated based on the difference between the annual premium of the replacement coverage and that of the original coverage. If the premium on the replacement product is less than or equal to the premium for the product being replaced, the sales commission shall be limited to the percentage of sale normally paid for renewal of long-term care policies or certificates. Replacement shall be contingent upon the insurer’s declaration that the replacement policy materially improves the position of the insured, pursuant to Section 10235.16. This provision does not apply to replacement coverage which is group insurance as described in subdivision (a) of Section 10231.6. (b) For purposes of this section, “commission or other compensation” includes pecuniary or nonpecuniary remuneration of any kind relating to the sale or renewal of the policy or certificate including, but not limited to, bonuses, gifts, prizes, awards, and finder’s fees. (c) Every long-term care insurer shall file with the commissioner within six months of the effective date of this section, its commission structure or an explanation of the insurer’s compensation plan. Any amendments to the commission structure shall be filed with the commissioner before implementation. (Amended by Stats. 1993, Ch. 316, Sec. 1. Effective August 30, 1993.)
  94. 10235.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    This article applies to long-term care insurance policies delivered or issued for delivery in the state on or after January 1, 1990, except as provided in Section 10235.95.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235. Except as provided in Section 10235.95, this article applies to all long-term care insurance policies delivered or issued for delivery in this state on or after January 1, 1990. (Amended by Stats. 2008, Ch. 171, Sec. 1. Effective January 1, 2009.)
  95. 10235.10.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    Ending long-term care insurance does not cut off benefits for institutionalization that started while the policy was in force and continues without interruption after termination.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.10. Termination of long-term care insurance shall be without prejudice to any benefits payable for institutionalization if that institutionalization began while the long-term care insurance was in force and continues without interruption after termination. This extension of benefits beyond the period the long-term care insurance was in force may be limited to the duration of the benefit period, if any, or to payment of the maximum benefits and may be subject to any policy waiting period, and all other applicable provisions of the policy. (Added by Stats. 1989, Ch. 767, Sec. 2.)
  96. 10235.14.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    Long-term care insurance policies must include specified disclosures and formatting for renewability, riders or endorsements, preexisting condition limits, and eligibility conditions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.14. (a) Individual long-term care insurance policies shall contain a renewability provision. This provision shall be appropriately captioned, shall appear on the first page of the policy, and shall clearly disclose the term of coverage for which the policy is initially issued, the terms and conditions under which the policy may be renewed, and whether or not the issuer has the right to change the premium. If this right exists, the policy provisions shall clearly and concisely describe each circumstance under which the premium may change. (b) Except for riders or endorsements by which the insurer effectuates a request made in writing by the insured under an individual long-term care insurance policy, all riders or endorsements added to an individual long-term care insurance policy after date of issue or at reinstatement or renewal which reduce or eliminate benefits or coverage in the policy shall require signed acceptance by the individual insured. After the date of policy issue, any rider or endorsement which increases benefits or coverage with a concomitant increase in premium during the policy term shall be agreed to in writing signed by the insured, unless the increased benefits or coverage are required by law. If a separate additional premium is charged for benefits provided in connection with riders or endorsements, that premium charge shall be set forth in the policy, rider, or endorsement. (c) If a long-term care insurance policy or certificate contains any limitations with respect to preexisting conditions, those limitations shall appear as a separate paragraph of the policy or certificate and shall be labeled as “preexisting condition limitations.” (d) A long-term care insurance policy or certificate containing any limitations or conditions for eligibility shall set forth in a separate paragraph of the policy or certificate a description of those limitations or conditions, including any required number of days of confinement, and shall label that paragraph “Limitations or Conditions on Eligibility for Benefits.” (Amended by Stats. 1992, Ch. 1132, Sec. 31. Effective January 1, 1993.)
  97. 10235.16.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    Long-term care insurance application forms must ask whether the policy is meant to replace existing accident and sickness or long-term care coverage, and replacement sales must trigger a notice and retention of signed copies.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.16. (a) Long-term care insurance application forms shall include a question designed to elicit information as to whether the proposed insurance is intended to replace any other accident and sickness or long-term care insurance presently in force. A supplementary application or other form to be signed by the applicant containing such a question may be used. (b) Upon determining that a sale will involve replacement, an insurer, other than an insurer using direct response solicitation methods, or its agent shall furnish the applicant, prior to issuance or delivery of a policy or certificate, a notice regarding replacement of accident and sickness or long-term care coverage. One copy of this notice shall be retained by the applicant and an additional copy signed by the applicant shall be retained by the insurer. The required notice shall be provided in the following form: “NOTICE TO APPLICANT REGARDING REPLACEMENT OF ACCIDENT AND SICKNESS OR LONG-TERM CARE INSURANCE According to (your application) (information you have furnished), you intend to lapse or otherwise terminate existing accident and sickness or long-term care insurance and replace it with long-term care insurance coverage to be issued by (company name) Insurance Company. Your new coverage provides thirty (30) days within which you may decide, without cost, whether you desire to keep the coverage. For your own information and protection, you should be aware of and seriously consider certain factors which may affect the insurance protection available to you under the new coverage. (1) Health conditions which you may presently have (preexisting conditions), may not be immediately or fully covered under the new coverage. This could result in denial or delay in payment of benefits under the new coverage, whereas a similar claim might have been payable under your present coverage. (2) You may wish to secure the advice of your present insurer or its agent regarding the proposed replacement of your present coverage. This is not only your right, but it is also in your best interest to make sure you understand all the relevant factors involved in replacing your present coverage. (3) If, after due consideration, you still wish to terminate your present coverage and replace it with new coverage, be certain to truthfully and completely answer all questions on the application concerning your medical health history. Failure to include all material medical information on an application may provide a basis for the company to deny any future claims and to refund your premium as though your coverage had never been in force. After the application has been completed and before you sign it, reread it carefully to be certain that all the information has been properly recorded. The above “Notice to Applicant” was delivered to me on: (Date) (Applicant’s Signature)” (c) For group coverage not subject to the 30-day return provision of Section 10232.7, the notice shall be modified to reflect the appropriate time period in which the policy may be returned and premium refunded. (d) The replacement notice shall include the following statement except when the replacement coverage is group insurance as described in subdivision (a) of Section 10231.6: COMPARISON TO YOUR CURRENT COVERAGE: I have reviewed your current long-term care coverage. To the best of my knowledge, the replacement of insurance involved in this transaction materially improves your position for the following reasons: ____ Additional or different benefits (please specify) ______. ____ No change in benefits, but lower premiums. ____ Fewer benefits and lower premiums. ____ Other (please specify) ______. (Signature of Agent and Name of Insurer) (Signature of Applicant) (Date) (Amended by Stats. 1992, Ch. 1132, Sec. 32. Effective January 1, 1993.)
  98. 10235.17.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    The commissioner must define “inappropriate replacement” of long-term care insurance, and must do so in consultation with other interested parties.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.17. For purposes of this chapter, the commissioner shall define inappropriate replacement of long-term care insurance in consultation with other interested parties. (Added by Stats. 1992, Ch. 1132, Sec. 33. Effective January 1, 1993.)
  99. 10235.18.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    Certain insurers must give applicants a replacement notice when the policy or certificate is issued, and group coverage notices must be adjusted for the applicable return-and-refund period.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.18. (a) Insurers using direct response solicitation methods shall deliver a notice regarding replacement of accident and sickness or long-term care coverage to the applicant upon issuance of the policy or certificate. The required notice shall be provided in the following form: “NOTICE TO APPLICANT REGARDING REPLACEMENT OF ACCIDENT AND SICKNESS OR LONG-TERM CARE INSURANCE According to (your application) (information you have furnished), you intend to lapse or otherwise terminate existing accident and sickness or long-term care insurance and replace it with the long-term care insurance coverage delivered herewith issued by (company name) Insurance Company. Your new coverage provides thirty (30) days within which you may decide, without cost, whether you desire to keep the policy or certificate. For your own information and protection, you should be aware of and seriously consider certain factors which may affect the insurance protection available to you under the new coverage. (1) Health conditions which you may presently have (preexisting conditions), may not be immediately or fully covered under the new coverage. This could result in denial or delay in payment of benefits under the new coverage, whereas a similar claim might have been payable under your present coverage. (2) You may wish to secure the advice of your present insurer or its agent regarding the proposed replacement of your present policy coverage. This is not only your right, but it is also in your best interest to make sure you understand all the relevant factors involved in replacing your present coverage. (3) (To be included only if the application is attached to the policy or certificate). If, after due consideration, you still wish to terminate your present coverage and replace it with new coverage, read the copy of the application attached to your new coverage and be sure that all questions are answered fully and correctly. Omissions or misstatements in the application could cause an otherwise valid claim to be denied. Carefully check the application and write to (company name and address) within thirty (30) days if any information is not correct and complete, or if any past medical history has been left out of the application. (Company Name)” (b) For group coverage not subject to the 30-day return provision of Section 10232.7, the notice shall be modified to reflect the appropriate time period in which the policy may be returned and premium refunded. (Added by Stats. 1989, Ch. 767, Sec. 2.)
  100. 10235.2.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    A long-term care insurance policy delivered or issued for delivery in this state may not use listed terms unless the policy defines them as required.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.2. No long-term care insurance policy delivered or issued for delivery in this state shall use the terms set forth below, unless the terms are defined in the policy and the definitions satisfy the following requirements: (a) “Medicare” shall be defined as the “Health Insurance for the Aged Act,” Title XVIII of the Social Security Amendments of 1965 as then constituted or later amended, or Title I, Part I of Public Law 89-97, as enacted by the 89th Congress of the United States of America and popularly known as the Health Insurance for the Aged Act, as then constituted and any later amendments or substitutes thereof, or words of similar import. (b) “Skilled nursing care,” “intermediate care,” “home health care,” and other services shall be defined in relation to the level of skill required, the nature of the care and the setting in which care is required to be delivered. (c) All providers of services, including, but not limited to, skilled nursing facilities, intermediate care facilities, and home health agencies shall be defined in relation to the services and facilities required to be available and the licensure or degree status of those providing or supervising the services. The definition may require that the provider be appropriately licensed or certified. (Amended by Stats. 1999, Ch. 947, Sec. 9.5. Effective January 1, 2000.)
  101. 10235.20.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    The commissioner may waive specific article requirements for a particular long-term care insurance policy or certificate, and may require alternative compliance terms.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.20. The commissioner may waive a specific provision or provisions of this article with respect to a specific long-term care insurance policy or certificate upon making written findings specified in subdivisions (a), (b), and (c), as follows: (a) The waiver would be in the best interest of the insureds. (b) The underlying purposes of this article could not be effectively or efficiently achieved without the waiver. (c) Any of the following: (1) The waiver is necessary to the development of an innovative and reasonable approach for insuring long-term care. (2) The policy or certificate is to be issued to residents of a life care or continuing care retirement community or some other residential community for the elderly and the waiver is reasonably related to the special needs or nature of such a community. (3) The waiver is necessary to permit long-term care insurance to be sold as part of, or in conjunction with, another insurance product. The commissioner may condition any waiver upon compliance with alternative requirements to achieve the purposes of this article. (Added by Stats. 1989, Ch. 767, Sec. 2.)
  102. 10235.30.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    Insurers selling long-term care policies in this state must offer a shortened benefit period nonforfeiture option at application, with specified minimum benefits and no cash-back, extended-term, or reduced paid-up forms.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.30. (a) No insurer may deliver or issue for delivery a long-term care policy in this state unless the insurer offers at the time of application an option to purchase a shortened benefit period nonforfeiture benefit with the following features: (1) Eligibility begins no later than after 10 years of premium payments. (2) The lifetime maximum benefit is no less than the dollar equivalent of three months of care at the nursing facility per diem benefit contained in the policy or the amount of the premiums paid, whichever is greater. (3) The same benefits covered in the policy and any riders at the time eligibility begins are payable for a qualifying claim. (4) The lifetime maximum benefit may be reduced by the amount of any claims already paid. (5) Cash back, extended term, and reduced paid-up forms of nonforfeiture benefits shall not be allowed. (6) The lifetime maximum benefit amount increases proportionally with the number of years of premium payment. (b) This section shall not apply to life insurance policies that accelerate benefits for long-term care. (Amended by Stats. 1999, Ch. 947, Sec. 11. Effective January 1, 2000.)
  103. 10235.35.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    The commissioner may require an insurer to provide or administer contingent-benefit coverage changes for long-term care insurance rate adjustments, and the insurer must notify policyholders and certificate holders when required.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.35. (a) Notwithstanding any other law, the commissioner may require the administration by an insurer of the contingent benefit upon lapse, as described in Section 28 (A), (D) (3), (E), (F), (G), and (J) of the Long-Term Care Insurance Model Regulation promulgated by the National Association of Insurance Commissioners, as adopted in September 2014, as a condition of approval or acknowledgment of a rate adjustment for a block of business for which the contingent benefit upon lapse is not otherwise available. (b) The insurer shall notify policyholders and certificate holders of the contingent benefit upon lapse when required by the commissioner in conjunction with the implementation of a rate adjustment. The commissioner may require an insurer who files for such a rate adjustment to allow policyholders and certificate holders to reduce coverage pursuant to Section 10235.50 to avoid an increase in the policy’s premium amount. (c) The commissioner may also approve any other alternative mechanism filed by the insurer in lieu of the contingent benefit upon lapse. (Amended by Stats. 2015, Ch. 348, Sec. 24. (AB 1515) Effective January 1, 2016.)
  104. 10235.36.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    An insurer must send election forms and notices about certain long-term care insurance benefits, and policyholders may designate another person to receive annual notices.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.36. (a) When a shortened benefit period nonforfeiture benefit, as described in Section 10235.30, or a contingent benefit upon lapse, as described in Section 10235.35, is conferred, the insurer shall mail to and receive from each policyholder or certificate holder an election form which allows the policyholder or certificate holder to elect one of the following: (1) A written designation listing the name, address, and telephone number of at least one individual, in addition to the policyholder or certificate holder, who is to receive the annual notice as described in subdivision (c). (2) A confirmation that the policyholder or certificate holder designates the same person previously designated in Section 10235.40 to receive the annual notice as described in subdivision (c). (3) A waiver signed and dated by the policyholder or certificate holder electing not to designate additional persons to receive the annual notice as described in subdivision (c). The required waiver shall read as follows: “I understand that I have the right to designate at least one person other than myself to receive annual notification related to the benefit retained under this long-term care insurance policy. I elect not to designate any person other than myself to receive the notice. ___________________________________________________________ Signature of Policyholder or Certificate Holder Date” (b) The insurer shall notify all holders of a shortened benefit period nonforfeiture benefit or a contingent benefit upon lapse at the time of the annual notice as described in subdivision (c), of the right to change the election described in subdivision (a). (c) At the time a shortened benefit period nonforfeiture benefit or contingent benefit upon lapse is conferred and annually thereafter the insurer shall notify all holders of the benefit and, if elected, at least one individual designated pursuant to paragraph (1) or (2) of subdivision (a) by first-class United States mail, postage prepaid, of all of the following: (1) The availability of the shortened benefit period nonforfeiture benefit or contingent benefit upon lapse. (2) The dollar amount of the shortened benefit period nonforfeiture benefit or contingent benefit upon lapse calculated up to 60 days prior to the date of the annual notice. The notice shall state that the amount may have been reduced if benefits were paid in the period subsequent to the date on which that amount was calculated. (3) The name, address, and telephone number of the insurer for questions about the shortened benefit period nonforfeiture benefit or contingent benefit upon lapse. (d) For individuals who hold contingent benefits upon lapse as of the effective date of this section, the insurer shall send the election form required in subdivision (a) by July 1, 2016. (e) If, upon proper mailing by the insurer, the policyholder or certificate holder fails to return the election form described in subdivision (a) within 90 days, the failure will be deemed a waiver as provided in paragraph (3) of subdivision (a). (Added by Stats. 2015, Ch. 544, Sec. 1. (SB 575) Effective January 1, 2016.)
  105. 10235.40.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    An insurer must give policyholders and insureds certain lapse notices and options before an individual long-term care policy can be issued or terminated for nonpayment, and must include reinstatement and disclosure rules in specified cases.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.40. (a) An individual long-term care policy or certificate shall not be issued until the applicant has been given the right to designate at least one individual, in addition to the applicant, to receive notice of lapse or termination of a policy or certificate for nonpayment of premium. The insurer shall receive from each applicant one of the following: (1) A written designation listing the name, address, and telephone number of at least one individual, in addition to the applicant, who is to receive notice of lapse or termination of the policy or certificate for nonpayment of premium. (2) A waiver signed and dated by the applicant electing not to designate additional persons to receive notice. The required waiver shall read as follows: “Protection Against Unintended Lapse. I understand that I have the right to designate at least one person other than myself to receive notice of lapse or termination of this long-term care insurance policy for nonpayment of premium. I understand that notice will not be given until 30 days after a premium is due and unpaid. I elect not to designate any person to receive the notice. Signature of Applicant Date” (b) The insurer shall notify the insured of the right to change the written designation, no less often than once every two years. (c) If the policyholder or certificate holder pays the premium for a long-term care insurance policy or certificate through a payroll or pension deduction plan, the requirements contained in subdivision (a) need not be met until 60 days after the policyholder or certificate holder is no longer on that deduction payment plan. The application or enrollment form for a certified long-term care insurance policy or certificate shall clearly indicate the deduction payment plan selected by the applicant. (d) An individual long-term care policy or certificate shall not lapse or be terminated for nonpayment of premium unless the insurer, at least 30 days before the effective date of the lapse or termination, gives notice to the insured and to the individual or individuals designated pursuant to subdivision (a), at the address provided by the insured for purposes of receiving notice of lapse or termination. Notice shall be given by first-class United States mail, postage prepaid, not less than 30 days after a premium is due and unpaid. (e) A long-term care insurance policy or certificate shall include a provision that, in the event of lapse, provides for reinstatement of coverage, if the insurer is provided with proof of the insured’s cognitive impairment or the loss of functional capacity. This option shall be available to the insured if requested within five months after termination and shall allow for the collection of a past due premium, if appropriate. The standard of proof of cognitive impairment or loss of functional capacity shall not be more stringent than the benefit eligibility criteria on cognitive impairment or the loss of functional capacity contained in the policy certificate. (f) If a universal life insurance policy includes coverage for long-term care and may lapse due to insufficient account value even if all scheduled premiums are paid on time and no loans or withdrawals are taken, then an applicant shall receive the disclosure below or a substantially similar disclosure that contains all of the information below. The disclosure shall be submitted to the commissioner for approval. The disclosure shall be signed and dated by the applicant and the agent. One copy of the disclosure shall be retained by the applicant and an additional copy shall be retained by the insurer. The disclosure shall be in the following form: “Disclosure of Risk of Lapse and Offer of Protection Against Lapse APPLICANT: Please review and check the appropriate line(s), and sign and date below. My agent has explained to me that the universal life insurance policy I am applying for may lapse (terminate) due to insufficient account value, even if I pay all the scheduled premiums on time and take no loans or withdrawals, and that if my life insurance policy lapses then I will also lose my long-term care coverage. ____ I have been offered a benefit that would guarantee the policy against lapse if I pay all required premiums on time, take no loans or withdrawals, and comply with other policy provisions. I have reviewed this offer. ____ I have been offered a policy that includes long-term care coverage and is guaranteed against lapse if I pay all required premiums on time, take no loans or withdrawals, and comply with other policy provisions. I have reviewed this proposal. ____ I have been informed by my agent that other insurers offer policies that include long-term care coverage and that would be guaranteed against lapse if I pay all required premiums on time and take no loans or withdrawals. However, the insurer of the policy that I am applying for does not. I understand that I will have to apply for insurance with a different insurance company if I would like to purchase a policy that includes long-term care coverage with this kind of lapse protection. Signature of applicant Date AGENT: Please review and check the appropriate line(s), and sign and date below. I have explained to the applicant that the universal life insurance policy the applicant is applying for may lapse due to insufficient account value, even if all scheduled premiums are paid on time and no loans or withdrawals are taken, and that if the life insurance policy lapses then the long-term care coverage will also be lost. ____ I offered the applicant, and the applicant has reviewed, the following option(s) [check all that apply]: ____ An optional no-lapse guarantee benefit. I have explained that a no-lapse guarantee benefit would guarantee the policy against lapse if all required premiums are paid on time and no loans or withdrawals are taken. ____ A different universal life policy that includes long-term care coverage and is offered with a no-lapse guarantee benefit. I have explained that a no-lapse guarantee benefit would guarantee the policy against lapse if all required premiums are paid on time and no loans or withdrawals are taken. ____ A whole life policy that includes long-term care coverage. I have explained that a whole life policy is guaranteed against lapse if all required premiums are paid on time. ____ A stand-alone long-term care policy. I have explained that a stand-alone long-term care policy is guaranteed against lapse if all required premiums are paid on time. ____ I have explained that the applicant will have to apply for insurance with a different insurance company if the applicant would like to purchase a policy that includes long-term care coverage and would be guaranteed against lapse if all required premiums are paid on time and no loans or withdrawals are taken. Signature of agent Date” (Amended by Stats. 2019, Ch. 625, Sec. 1. (AB 1209) Effective January 1, 2020.)
  106. 10235.45.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    Insurers must give policyholders certain notices and statements before and after accelerated death benefit payments for long-term care, and before approving related loan or withdrawal requests.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.45. (a) If a life insurance policy contains long-term care benefits and permits policy loans or cash withdrawals, then access to those loans or withdrawals shall not be prohibited or limited due to the payment of long-term care benefits, except as provided in paragraphs (1) and (2). (1) Payment of an accelerated death benefit for long-term care shall result in no more than a pro rata reduction in the cash value of the life insurance policy. A reduction in cash value shall be proportionally equal to the percentage of death benefits accelerated to produce the accelerated death benefit payment. Future access to policy loans and cash withdrawals may be limited to the remaining cash value. (2) Notwithstanding paragraph (1), payment of an accelerated death benefit for long-term care may be considered a lien against the death benefit of the life insurance policy, and access to the cash value of the life insurance policy may be restricted to the excess of the cash value over the sum of outstanding policy loans and the lien. Future access to policy loans and cash withdrawals may also be limited to the excess of the cash value over the sum of outstanding policy loans and the lien. (3) This subdivision applies only to policies issued on or after January 1, 2021. (b) If payment of an accelerated death benefit for long-term care results in a pro rata reduction in the cash value of the life insurance policy, the payment may be applied toward repayment of a pro rata portion of outstanding policy loans. The amount of the loan repayment shall be proportionally equal to the percentage of death benefits accelerated to produce the accelerated death benefit payment. (c) At least 30 days before the expected first payment of an accelerated death benefit for long-term care, the insurer shall provide the policyholder or certificate holder with a statement that includes the information described in this subdivision. Alternatively, an insurer may provide the statement at the time of payment, but only if the insurer allows cancellation of the payment for at least 30 days after it is made. (1) The statement shall be dated and shall include all of the following: (A) An explanation of changes to the policy that have occurred as a result of the payment, or would occur as a result of the estimated payment, including, but not limited to, a prohibition or limitation of access to loans or cash withdrawals. (B) A numerical demonstration of the estimated effect of the payment on any applicable remaining policy values. The demonstration shall include, if applicable, impact to the death benefit, cash value or accumulation amount, policy loan value, outstanding policy loan amount, no-lapse guarantee, policy lien, premium payments or cost of insurance charges, and any other values impacted by the payment. (C) A notice stating: “WARNING: Payment of an accelerated death benefit for long-term care will reduce and may potentially eliminate your death benefit. Receipt of an accelerated death benefit for long-term care may be taxable and may also adversely affect your eligibility for Medicaid or other government entitlements. Please consult a financial advisor.” (2) If the statement is provided before the payment date, it shall also include all of the following: (A) The expected payment date. (B) An explanation that the policyholder or certificate holder may request payment before the expected payment date. (C) Notice that the policyholder or certificate holder may cancel the payment by contacting the insurer at the insurer’s address or telephone number at any time before the expected payment date. (3) If the statement is provided at the time of payment, it shall also include notice that the policyholder or certificate holder may cancel the payment by contacting the insurer at the insurer’s address or telephone number within the cancellation period and returning the payment. (d) The statement required by subdivision (c) is required only once per policyholder for an individual policy, or once per certificate holder for a group policy, and does not need to be provided for later accelerated death benefit claims by the same policyholder or certificate holder. (e) No later than 30 days after every payment of an accelerated death benefit for long-term care, or 45 days after the first payment of an accelerated death benefit for long-term care, the insurer shall provide the policyholder or certificate holder with a statement summarizing the effect of the payment on the remaining policy values. The statement shall include all of the following: (1) The accelerated death benefits paid out during the prior month. (2) An explanation of changes, if applicable, to the remaining death benefit, cash value or accumulation account, policy loan value, outstanding policy loan amount, no-lapse guarantee, policy lien, premium payments or cost of insurance charges, and any other values impacted by the payment. (3) The amount of the remaining benefits that can be accelerated. (f) If a policyholder or certificate holder initiates a request to take a loan or withdrawal from the cash value of a life insurance policy that accelerates benefits for long-term care, the insurer shall provide the policyholder or certificate holder with a statement that includes the information described in paragraph (3). (1) Except for a loan that is immediately approved pursuant to paragraph (2), a request to take a loan or withdrawal shall be deemed incomplete, and the insurer shall not approve the loan or withdrawal, until the information has been provided and the policyholder or certificate holder submits a response that finalizes the request for the loan or withdrawal. (2) The insurer may immediately approve a loan and provide the statement at the time of payment, but only if the loan is not treated as a taxable distribution for federal income tax purposes and the insurer permits cancellation of the loan for at least 30 days after the loan payment has been made. (A) The insurer shall provide notice that the policyholder or certificate holder may cancel the loan by contacting the insurer at the insurer’s address or telephone number within the cancellation period and returning the loan payment. (B) At the time the loan is requested, the insurer shall provide an option to receive the statement before the loan request is finalized. If the policyholder or certificate holder elects this option, the loan request shall be deemed incomplete, and the insurer shall not approve the loan, until the statement has been provided and the policyholder or certificate holder submits a response that finalizes the request for the loan. (3) The statement shall be dated and shall include all of the following: (A) An explanation of changes to the policy that would occur as a result of the loan or withdrawal. (B) A numerical demonstration of the estimated effect of the payment on any applicable remaining policy values. The demonstration shall include, if applicable, impact to the death benefit, cash value or accumulation amount, policy loan value, outstanding policy loan amount, no-lapse guarantee, policy lien, premium payments or cost of insurance charges, daily, monthly, or lifetime long-term care benefits, and any other values impacted by the payment. (C) If a policyholder or certificate holder is initiating a request for a loan, a notice stating: “WARNING: Loans may reduce and potentially eliminate your death benefit and your long-term care benefits. Receipt of a loan may adversely affect your eligibility for Medicaid or other government entitlements, and loan proceeds may be taxable if the loan is not repaid and the policy is surrendered or lapses. Please consult a financial advisor.” (D) If a policyholder or certificate holder is initiating a request for a withdrawal, a notice stating: “WARNING: Cash withdrawals may reduce and potentially eliminate your death benefit and your long-term care benefits. Receipt of a cash withdrawal may be taxable and may also adversely affect your eligibility for Medicaid or other government benefits or entitlements. Please consult a financial advisor.” (E) A description of circumstances in which a loan or withdrawal may result in or contribute to the lapse of the policy. (F) If applicable, a hypothetical demonstration of how loan repayment may be deducted from a future payment of an accelerated death benefit for long-term care. (G) If applicable, a notice explaining the rate at which the loan will accrue interest and stating the projected outstanding loan amount after five years, assuming that the interest rate does not change, no loan repayments are made, and no additional loans are taken. (g) The statements and notices required by this section shall be in at least 12-point type. (Amended by Stats. 2022, Ch. 424, Sec. 27. (SB 1242) Effective January 1, 2023.)
  107. 10235.50.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    This section requires long-term care policies or certificates to let the policyholder or certificate holder keep coverage while reducing benefits and premium, and gives related notice and reinstatement rules.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.50. (a) A policy or certificate shall include a provision that gives the policyholder or certificate holder the right, exercisable any time after the first year, to retain the policy or certificate while reducing coverage and lowering the premium. (1) The policyholder or certificate holder shall have the option to reduce coverage and lower the premium in the following ways: (A) Reducing the lifetime maximum benefit. (B) Reducing the daily, weekly, or monthly benefit amounts. (C) Converting a “comprehensive long-term care” policy or certificate to a “Nursing Facility and Residential Care Facility Only” or a “Home Care Only” policy or certificate, if the insurer issues those policies or certificates for sale in the state. (D) Reducing or eliminating the benefit adjustments provided by an inflation protection provision. (2) Subparagraph (D) of paragraph (1) shall apply to a policy issued or delivered on or after January 1, 2020. (3) The insurer may offer other reduction options in addition to those required by paragraph (1). (4) For a policy issued or delivered on or after January 1, 2020, the provision shall include a description of the process for requesting and implementing a reduction in coverage. For a policy issued or delivered before January 1, 2020, an insurer shall notify the policyholder or certificate holder of the process to request and implement a reduction in coverage. (b) (1) The premium for a policy or certificate that is reduced in coverage shall be both of the following: (A) Based on the issue age and underwriting class used to determine the premium for the coverage currently in force. (B) Consistent with the policy’s approved rate table. (2) This subdivision shall apply to any reduction in coverage, regardless of the original policy issue date. (c) (1) If a policy or certificate contains an inflation protection provision, both of the following shall apply to a reduction in coverage: (A) If a policyholder or certificate holder chooses to reduce a daily, weekly, monthly, or lifetime benefit amount, then the policyholder or certificate holder shall be given the option to continue inflation protection benefit adjustments in the same manner and in the same amount as the contract in force before the reduction in coverage. (B) If a policyholder or certificate holder chooses to reduce or eliminate the benefit adjustments provided by an inflation protection provision, then the policyholder or certificate holder shall be given the option to continue the daily, weekly, monthly, and lifetime benefit amounts in effect at the time of the reduction. (2) This subdivision shall apply to any reduction in coverage, regardless of the original policy issue date. (d) If a policy or certificate is about to lapse, the insurer shall provide written notice to the insured of the options in subdivision (a) to lower the premium by reducing coverage and of the premiums applicable to the reduced coverage options. The insurer may include in the notice additional options to those required in subdivision (a). The notice shall provide the insured at least 30 days in which to elect to reduce coverage and the policy shall be reinstated without underwriting if the insured elects the reduced coverage. (e) If a premium increases, the policyholder or certificate holder shall have the right to retain the policy or certificate while reducing coverage and lowering the premium. (1) The policyholder or certificate holder shall be offered the option to reduce coverage as provided in subparagraphs (A), (B), and (D) of paragraph (1) of subdivision (a). (A) At least one option to reduce coverage shall allow the policyholder or certificate holder to retain the policy for a premium reasonably equivalent to the one that was in effect before the rate increase. (B) An insurer may offer other reduction options in addition to the option required by paragraph (1). (C) An insurer’s offer shall include a disclosure stating that all of the reduction options may not be of equal value. (D) The policyholder or certificate holder of a policy or certificate offered under the California Partnership for Long-Term Care Program shall be offered options to reduce coverage that would maintain certification under the program, as described in subdivision (d) of Section 22005.1 of the Welfare and Institutions Code. The insurer may also offer other reduction options that may result in a loss of partnership status, but shall disclose that the options may result in a loss of partnership status and explain that loss of partnership status may reduce or eliminate policyholder or certificate holder protections. (2) This subdivision shall apply to any premium rate increase, regardless of the original policy issue date. (Amended by Stats. 2022, Ch. 534, Sec. 1. (AB 2604) Effective January 1, 2023.)
  108. 10235.51.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    Long-term care policies or certificates must give the insured an option to buy coverage-increasing riders for extra premium at least on each anniversary date after issuance.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.51. (a) Every policy or certificate shall include a provision that gives the insured the option to elect, no less frequently than on each anniversary date after the policy or certificate is issued, to pay an extra premium for one or more riders that increase coverage in any of the following ways: (1) Increase the amount of the per diem benefits. (2) Increase the lifetime maximum benefit. (3) Increase the amount of both the nursing facility per diem benefit and the home- and community-based care benefits of a comprehensive long-term care insurance policy or certificate. (b) The premiums for the riders to increase coverage may be based on the attained age of the insured. The premium for the original policy or certificate will not be changed and will continue to be based on the insured’s age when the original policy or certificate was issued. (c) The insurer may require the insured to undergo new underwriting, in addition to the payment of an additional premium, to qualify for the additional coverage. The insurer may restrict the age for issuance of additional coverage and restrict the aggregate amount of additional coverage an insured may acquire to the maximum age and coverage the insurer allows when issuing a new policy or certificate. (Added by Stats. 1997, Ch. 699, Sec. 16. Effective October 6, 1997.)
  109. 10235.52.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    If an insurer creates new long-term care benefits or new policies with new benefits, it must give eligible current policyholders specified options and notice, and file the notice with the department.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.52. (a) Each policy shall contain a provision that, if the insurer develops new benefits or benefit eligibility or new policies with new benefits or benefit eligibility not included in the previously issued policy, the insurer shall grant current holders of its policies who are not in benefit or within the elimination period all of the following rights: (1) The insurer shall notify the policyholder of the availability of the new benefits or benefit eligibility or new policy within 12 months of the date that the new policy series is made available for sale in this state. The insurer shall file the notice with the department at the same time as the new policy or rider. (2) The insurer shall offer the policyholder new benefits or benefit eligibility in one of the following ways: (A) By adding a rider to the existing policy and paying a separate premium for the new benefits or benefit eligibility based on the insured’s attained age. The premium for the existing policy shall remain unchanged based on the insured’s age at issuance. (B) By replacing the existing policy or certificate in accordance with Section 10234.87. (C) By replacing the existing policy or certificate with a new policy or certificate, in which case consideration for past insured status shall be recognized by setting the premium for the replacement policy or certificate at the issue age of the policy or certificate being replaced. (b) The insured may be required to undergo new underwriting, but the underwriting can be no more restrictive than if the policyholder or certificate holder were applying for a new policy or certificate. (c) The insurer of a group policy as defined under subdivisions (a) to (c), inclusive, of Section 10231.6 shall offer the group policyholder the opportunity to have coverage for the new benefits and provisions extended to existing certificate holders, but the insurer is relieved of the obligations imposed by this section if the holder of the group policy declines the issuer’s offer. (d) For purposes of this section, new benefits means coverage for new long-term care services or providers that are material in nature. New benefits that are material in nature do not include changes to policy structure, benefits, or provisions that are minor in nature. Changes that are minor in nature include, but are not limited to, changes in elimination periods, benefit periods, and benefit amounts. (Amended by Stats. 2017, Ch. 561, Sec. 140. (AB 1516) Effective January 1, 2018.)
  110. 10235.8.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    A long-term care insurance policy may not be delivered or issued for delivery in this state if it limits or excludes coverage by type of illness, treatment, medical condition, or accident, except for listed exceptions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.8. No policy may be delivered or issued for delivery in this state as long-term care insurance if the policy limits or excludes coverage by type of illness, treatment, medical condition, or accident, except as to the following: (a) Preexisting conditions or diseases. (b) Alcoholism and drug addiction. (c) Illness, treatment, or a medical condition arising out of any of the following: (1) War or act of war, whether declared or undeclared. (2) Participation in a felony, riot, or insurrection. (3) Service in the Armed Forces or units auxiliary thereto. (4) Suicide, whether or not the person had mental capacity to control what he or she was doing, attempted suicide, or intentionally self-inflicted injury. (5) Aviation in the capacity of a non-fare-paying passenger. (d) Treatment provided in a government facility, unless otherwise required by law, services for which benefits are available under Medicare or other governmental programs (except Medi-Cal or medicaid), state or federal workers’ compensation, employer’s liability or occupational disease law, or a motor vehicle no fault law, services provided by a member of the covered person’s immediate family, and services for which no charge is normally made in the absence of insurance. (e) This section does not prohibit exclusions and limitations by type of provider or territorial limitations. (Amended by Stats. 2014, Ch. 144, Sec. 45. (AB 1847) Effective January 1, 2015.)
  111. 10235.9.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    Insurers must report denied-claims data each year and send denial notices to affected policyholders or certificate holders within 40 days. The department must make claim denial rates available to the public on request.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.9. (a) Every insurer shall report annually by June 30 the total number of claims denied by each class of business in the state and the number of these claims denied for failure to meet the waiting period or because of a preexisting condition as of the end of the preceding calendar year. (b) The insurer shall provide every policyholder or certificate holder whose claim is denied a written notice within 40 days of the date of denial of the reasons for the denial and all information directly related to the denial. Insurers shall annually report to the department the number of denied claims. (c) The department shall make available to the public, upon request, the denial rate of claims by insurer. (Added by Stats. 1997, Ch. 699, Sec. 12. Effective October 6, 1997.)
  112. 10235.91.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    If a publicly funded non-Medicaid long-term care program duplicates covered benefits, the policyholder or certificate holder may choose either lower future premiums or higher future benefits.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.91. In the event a non-medicaid national or state long-term care program is created through public funding that substantially duplicates benefits covered by the policy or certificate, the policyholder or certificate holder will be entitled to select either a reduction in future premiums or an increase in future benefits. An actuarial method for determining the premium reductions and increases in future benefits will be mutually agreed upon by the department and insurers. The amount of the premium reductions and future benefit increases to be made by each insurer will be based on the extent of the duplication of covered benefits, the amount of past premium payments, and claims experience. Each insurer’s premium reduction and benefit increase plans shall be filed and approved by the department. (Added by Stats. 1997, Ch. 699, Sec. 18. Effective October 6, 1997.)
  113. 10235.94.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    Each policy or certificate must give the policyholder or certificate holder a right to appeal certain decisions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.94. Every policy or certificate shall include a provision giving the policyholder or certificate holder the right to appeal decisions regarding benefit eligibility, care plans, services and providers, and reimbursement payments. (Added by Stats. 1999, Ch. 947, Sec. 15. Effective January 1, 2000.)
  114. 10235.95.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    This section applies to all long-term care policies in force. For accepted claims on or after December 1, 2008, interest accrues and must be paid to the claimant at 10% per year starting the first calendar day after the claim payment is due.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.95. (a) Notwithstanding Section 10235, this section applies to all long-term care policies in force, regardless of their dates of issuance. (b) Interest shall accrue and shall be payable to the claimant at the rate of 10 percent per annum on the amount of any accepted claim beginning on the first calendar day after the day that the payment of the accepted claim is due pursuant to Section 2695.7 of Title 10 of the California Code of Regulations or any successor to that provision, provided that the claim is accepted on or after December 1, 2008. (Added by Stats. 2008, Ch. 171, Sec. 2. Effective January 1, 2009.)
  115. 10235.9a

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    If a covered long-term care policy or certificate has an alternate plan of care provision and the insurer and insured cannot agree, the insurer must give the policyholder or certificate holder a written explanation of the specific reasons.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10235.9a. For policies or certificates issued on or after January 1, 2017, that contain an alternate plan of care provision pursuant to Section 10231.3, if an insurer and insured cannot agree on the terms of an alternate plan of care, the insurer shall provide a written explanation to the policyholder or certificate holder as to the specific reason or reasons why the agreement cannot be reached. The insurer shall provide the written explanation within 60 days of the insurer’s determination that an agreement cannot be reached. (Added by Stats. 2016, Ch. 589, Sec. 4. (SB 1091) Effective January 1, 2017.)
  116. 10236.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    Long-term care policies and certificates must be either guaranteed renewable or noncancelable, and they must include a page-one renewability provision.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10236. Every individual and group long-term care policy and certificate under a group long-term care policy shall be either guaranteed renewable or noncancelable. (a) “Guaranteed renewable” means that the insured has the right to continue coverage in force if premiums are timely paid during which period the insurer may not unilaterally change the terms of coverage or decline to renew, except that the insurer may, in accordance with provisions in the policy, and in accordance with Section 10236.1, change the premium rates to all insureds in the same class. The “class” is determined by the insurer for the purpose of setting rates at the time the policy is issued. (b) “Noncancelable” means the insured has the right to continue the coverage in force if premiums are timely paid during which period the insurer may not unilaterally change the terms of coverage, decline to renew, or change the premium rate. (c) Every long-term care policy and certificate shall contain an appropriately captioned renewability provision on page one, which shall clearly describe the initial term of coverage, the conditions for renewal, and, if guaranteed renewable, a description of the class and of each circumstance under which the insurer may change the premium amount. (Amended by Stats. 2001, Ch. 159, Sec. 148. Effective January 1, 2002.)
  117. 10236.1.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    This section sets loss-ratio rules for certain long-term care insurance premium rate revisions and gives the commissioner limited approval power.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10236.1. (a) Benefits under individual long-term care insurance policies issued before new premium rate schedules are approved under Section 10236.11 shall be deemed reasonable in relation to premiums if the expected loss ratio is at least 60 percent, calculated in a manner that provides for adequate reserving of the long-term care insurance risk. (b) (1) For individual long-term care insurance policies issued before new premium rate schedules are approved under Section 10236.11, and for which rate revisions are filed on or after January 1, 2010, benefits shall be deemed reasonable in relation to the premium if the premium rate schedules have a lifetime expected loss ratio of at least 60 percent of the premium scale in effect on December 31, 2009, plus 70 percent of premium increases filed on or after January 1, 2010, calculated in a manner that provides for adequate reserving of the long-term care insurance risk. The lifetime expected loss ratio shall be calculated using the discount rate defined in paragraph (9) of subdivision (c). (2) However, if the premiums in any rate revision filing calculated in the manner provided in paragraph (1) produce a lifetime expected loss ratio that is less than the highest lifetime expected loss ratio for this policy form in the initial filing or that for requested premium rates in any filing made after January 1, 2013, the insurer shall reduce the premiums in the filing so that the current lifetime expected loss ratio is equal to or greater than the highest initially filed loss ratio or that for requested premium rates filed after January 1, 2013. In the determination of a lifetime expected loss ratio, a margin may reflect changes in the manner in which risks are shared between the insurer and a block of policies due to changes in this law effective January 1, 2013, and that margin shall not be increased unless the manner in which risks are shared between the insurer and the block of policies is changed further by law or regulation. The determination of the lifetime expected loss ratio shall be based on the actual distribution of policies in force at the time of the first filing after January 1, 2013, and not any prior assumed distribution. (c) In evaluating the expected loss ratio, due consideration shall be given to all relevant factors, including the following: (1) Statistical credibility of incurred claims experience and earned premiums. (2) The period for which rates are computed to provide coverage. (3) Experienced and projected trends. (4) Concentration of experience within early policy duration. (5) Expected claim fluctuation. (6) Experience refunds, adjustments, or dividends. (7) Renewability features. (8) All appropriate expense factors. (9) The discount rate used in the calculation of lifetime expected loss ratios. All present and accumulated values used to determine rate increases should use the maximum valuation interest rate for contract reserves. If one rate increase filing includes policy forms with different discount rates, separate projections for each discount rate should be prepared and then combined to create the total projection for the filings. (10) Experimental nature of the coverage. (11) Policy reserves. (12) Mix of business by risk classification. (13) Product features, such as long elimination periods, high deductibles, and high maximum limits. (d) Asset investment yield rate changes may not be used to justify a rate increase unless the insurer can demonstrate that its return on investments is lower than the maximum valuation interest rate for contract reserves for those policies or the commissioner determines that a change in interest rates is justified due to changes in laws or regulations that are retroactively applicable to long-term care insurance previously sold in this state. (e) The experience on all similar long-term care policy forms issued in this state by an insurer and its affiliates and retained within the affiliated group shall be pooled together and the combined experience shall be used as the basis for assumptions that satisfy the requirements in subdivisions (a) and (b). Those assumptions and requested rate increases may vary by policy form if actuarially appropriate. Similar long-term care policy forms shall be classified into one of the following benefit classifications: nursing facility and residential care facility only, home care only, or comprehensive long-term care benefits. (f) Notwithstanding any other provision of this section, for rate revisions filed on or after January 1, 2010, the commissioner may approve an application for a rate revision based on less than a 70 percent loss ratio, but not less than a 60 percent loss ratio, for the portion attributable to the rate increase if an insurer can demonstrate that the rates are necessary to protect the financial condition of the insurer, including avoidance of further reductions in capital and surplus. (g) This section applies only to long-term care insurance policies issued before the approval of rate schedules under Section 10236.11. (Amended by Stats. 2016, Ch. 304, Sec. 14. (AB 2884) Effective January 1, 2017.)
  118. 10236.11.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    Long-term care insurance premium rate schedules must be filed with and approved by the commissioner before policies are offered or issued, and insurers may not use scheduled age- or duration-based increases in certain policies.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10236.11. The premium rate schedules for all individual and group long-term care insurance policies issued in this state shall be filed with and receive the prior approval of the commissioner before the policy may be offered, sold, issued, or delivered to a resident of this state. All initial rate filings shall be subject to the following: (a) An approval for an initial premium schedule shall not be granted unless the actuary performing the review for the commissioner certifies that the initial premium rate schedule is sufficient to cover anticipated costs under moderately adverse experience and that the premium rate schedule is reasonably expected to be sustainable over the life of the form with no future premium increases anticipated. The certification may rely on supporting data in the filing. The actuary performing the review may request an actuarial demonstration that the assumptions the insurer has used are reasonable. The actuarial demonstration shall include either premium and claim experience on similar policy forms, adjusted for any premium or benefit differences, relevant and creditable data from other studies, or both. (b) The insurer shall submit to the commissioner for approval a rate filing for each policy form that includes at least all of the following information: (1) An actuarial memorandum that describes the assumptions the insurer used to develop the premium rate schedule. The actuarial assumptions shall include, but not be limited to, a sufficiently detailed description of morbidity assumptions, voluntary lapse rates, mortality assumptions, asset investment yield rates, a description of all expense components, and plan and option mix assumptions. The memorandum shall also include the expected lifetime loss ratio and projections of yearly earned premiums, incurred claims, incurred claim loss ratios, and changes in contract reserves. (2) An actuarial certification consisting of at least all of the following: (A) A statement that the initial premium rate schedule is sufficient to cover anticipated costs under moderately adverse experience and that the premium rate schedule is reasonably expected to be sustainable over the life of the form with no future premium increases anticipated. (B) A statement that the policy design and coverage provided have been reviewed and taken into consideration. (C) A statement that the underwriting and claims adjudication processes have been reviewed and taken into consideration. (D) A complete description of the basis for contract reserves that are anticipated to be held under the form, to include all of the following: (i) Sufficient detail or sample calculations provided so as to have a complete depiction of the reserve amounts to be held. (ii) A statement that the assumptions used for reserves contain reasonable margins for adverse experience. (iii) A statement that the net valuation premium for renewal years does not increase. (iv) A statement that the difference between the gross premium and the net valuation premium for renewal years is sufficient to cover expected renewal expenses, or if that statement cannot be made, a complete description of the situations in which this does not occur and the type and level of change in the reserve assumptions that would be necessary for the difference to be sufficient. An aggregate distribution of anticipated issues may be used as long as the underlying gross premiums maintain a reasonably consistent relationship. If the gross premiums for certain age groups appear to be inconsistent with this requirement, the commissioner may request a demonstration under subdivision (a) based on a standard age distribution. (E) A statement that the premium rate schedule is not less than the premium rate schedule for existing similar policy forms also available from the insurer except for reasonable differences attributable to benefits or a comparison of the premium schedules for similar policy forms that are currently available from the insurer with an explanation of the differences. (c) Premium rate schedules and new policy forms shall be filed by January 1, 2002, for all group long-term care insurance policies that an insurer will offer, sell, issue, or deliver on or after January 1, 2003, and for all previously approved individual long-term care insurance policies that an insurer will offer, sell, issue, or deliver on or after January 1, 2003, unless the January 1, 2002, deadline is extended by the commissioner. Insurers may continue to offer and market long-term care insurance policies approved before January 1, 2002, until the earlier of (1) 90 days after approval of both the premium rate schedules and new policy forms filed pursuant to this section or (2) January 1, 2003. Insurers that have filed premium rate schedules and new policy forms by March 1, 2002, may continue to offer and market long-term care insurance policies approved before January 1, 2002, until the earlier of (1) 90 days after approval of both the premium rate schedules and new policy forms filed pursuant to this section or (2) June 30, 2003. (d) This section shall not be construed as prohibiting an insurer from filing new group and individual policy forms, or from relieving an insurer of the obligation to file these forms, with the commissioner after January 1, 2003, if the policy form meets all the requirements of this chapter. (e) (1) The commissioner shall not approve an initial premium rate schedule that includes scheduled rate increases based on the attained age of the insured or the duration of the policy. (2) On and after January 1, 2021, a long-term care policy shall not be issued using a premium rate schedule that includes scheduled rate increases based on the attained age of the insured or the duration of the policy. (3) Notwithstanding paragraphs (1) and (2), this subdivision does not prohibit or impact the pricing of benefits that allow for the purchase of additional coverage if the cost of the additional coverage is based on the insured’s attained age at the time the additional coverage is added. (Amended by Stats. 2019, Ch. 625, Sec. 3. (AB 1209) Effective January 1, 2020.)
  119. 10236.12.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    The commissioner may use qualified independent actuaries to review certain rate applications, and the department must follow qualification, confidentiality, and cost-charging rules.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10236.12. All actuaries used by the commissioner to review rate applications submitted by insurers pursuant to this chapter who are employees of the department shall be members of the American Academy of Actuaries, with at least five years’ relevant experience in long-term care insurance industry pricing or alternatively shall meet the professional requirements to issue a “statement of actuarial opinion” as required by subdivision (a) of Section 10236.13. If the department does not have sufficient employees who are actuaries meeting the requirements of this section to perform the volume of work required by this chapter, the commissioner may contract, as necessary, with independent actuaries who shall be members of the American Academy of Actuaries with at least five years’ relevant experience in long-term care insurance industry pricing. If the department has employees who are actuaries, and independent actuaries under contract to the department, both meeting the requirements of this section to review rate applications, an insurer may generally choose between having the rate application reviewed by either employees or independent actuaries under contract to the department. The costs and expenses of reviews by independent actuaries under contract to the department shall be charged to the insurer. However, the department shall have the discretion to require a review by independent actuaries. Employees of the department who are actuaries and who are otherwise qualified to review rate applications but who do not meet the requirements of this section may assist an independent actuary under contract to the department. If the commissioner contracts with independent actuaries for purposes of this section, the commissioner shall promulgate regulations to maintain the confidentiality of rate filings and proprietary insurer information and to avoid conflicts of interest. (Repealed and added by Stats. 2009, Ch. 101, Sec. 3. (AB 389) Effective January 1, 2010.)
  120. 10236.13.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    An insurer may not raise premiums for covered long-term care policies or certificates unless the commissioner first approves the increase.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10236.13. No insurer may increase the premium for an individual or group long-term care insurance policy or certificate approved for sale under this chapter unless the insurer has received prior approval for the increase from the commissioner. The insurer shall submit to the commissioner for approval all proposed premium rate schedule increases, including at least all of the following information: (a) Certification by an actuary, who is a member of the American Academy of Actuaries and who meets the qualification standards of that organization, that: (1) If the requested premium rate schedule increase is implemented and the underlying assumptions, which reflect moderately adverse conditions, are realized, no further premium rate schedule increases are anticipated. (2) The premium rate filing is in compliance with the provisions of this section. (b) An actuarial memorandum justifying the rate schedule change request that includes all of the following: (1) Lifetime projections of earned premiums and incurred claims based on the filed premium rate schedule increase, and the method and assumptions used in determining the projected values, including reflection of any assumptions that deviate from those used for pricing other forms currently available for sale. (A) Annual values for the five years preceding and the three years following the valuation date shall be provided separately. (B) The projections shall include the development of the lifetime loss ratio. The lifetime expected loss ratio shall be calculated using the discount rate provided by subdivision (c) of Section 10236.14. (C) For policies issued with premium rate schedules approved under Section 10236.11, the projections shall demonstrate compliance with subdivision (a) of Section 10236.14. For all other policies, the projections shall demonstrate compliance with Section 10236.1. (D) If the commissioner determines that a premium rate increase is justified due to changes in laws or regulations that are retroactively applicable to long-term care insurance previously sold in this state, then: (i) The projected experience should be limited to the increases in claims expenses attributable to the changes in law or regulations. (ii) If the commissioner determines that potential offsets to higher claims costs may exist, the insurer shall be required to use appropriate net projected experience. (2) Disclosure of how reserves have been incorporated in this rate increase. (3) Disclosure of the analysis performed to determine why a rate adjustment is necessary, which pricing assumptions were not realized and why, and what other actions taken by the company have been relied on by the actuary. (4) A statement that policy design, underwriting, and claims adjudication practices have been taken into consideration. (5) A statement that asset investment yield rate changes have not been used to justify the rate increase unless the insurer can demonstrate that its return on investments is lower than the maximum valuation interest rate for contract reserves for those policies or the commissioner determines that a change in interest rates is justified due to changes in laws or regulations that are retroactively applicable to long-term care insurance previously sold in this state. (6) If it is necessary to maintain consistent premium rates for new certificates and certificates receiving a rate increase, the insurer shall file composite rates reflecting projections of new certificates. (c) A statement that renewal premium rate schedules are not greater than new business premium rate schedules except for differences attributable to benefits, unless sufficient justification is provided to the commissioner. (d) Sufficient information for approval of the premium rate schedule increase by the commissioner. (e) (1) The insurer, at its discretion, may request a premium rate schedule increase that is lower than the rate increase necessary to provide the certification required by subdivision (a) or a series of premium rate schedule increases with a present value of not more than the rate increase necessary to provide the certification required by subdivision (a). The commissioner may accept the premium rate schedule increase or series of increases without submission of the certification required by subdivision (a) if all of the following apply: (A) In the opinion of the commissioner, accepting the lower premium rate schedule increase or increases is in the best interest of California policyholders. (B) The actuarial memorandum discloses to the commissioner the rate increase necessary to provide the certification required by subdivision (a). (C) The rate increase filing satisfies all other requirements of this section. (D) The insurer discloses to policyholders affected by the approved increases the filed increase, the approved premium rate schedule increase or increases, and the amount and timing of any subsequent rate schedule increases included in the rate increase filing whether those subsequent rate schedule increases are approved or not approved by the commissioner. (2) The commissioner may approve a lower requested premium rate schedule increase and may approve the initial increase or more than just the initial increase requested pursuant to paragraph (1). (3) If the amount of increase after all increases disclosed pursuant to subparagraph (D) of paragraph (1), whether the increase or increases are approved or not approved by the commissioner, triggers the contingent benefit upon lapse, the commissioner shall require the administration by an insurer of the contingent benefit upon lapse as a condition of approval of a premium rate schedule increase that is lower than the amount necessary to provide the certification required by paragraph (1) of subdivision (a) or with the initial increase and each subsequent increase in a series of premium rate schedule increases. The commissioner may waive this condition of approval if an insurer demonstrates that the waiver is necessary to protect the financial condition of the insurer, including avoidance of further reductions in capital and surplus. (4) For purposes of paragraph (2) of subdivision (a) of Section 10236.14, the loss ratio calculation shall assume future premiums are based on the total filed rate schedule increase or series of increases disclosed pursuant to subparagraph (D) of paragraph (1), whether the increase or increases are approved or not approved by the commissioner. (5) Premium rate schedule increases requested pursuant to paragraph (1) or approved as described in paragraph (2) shall comply with the provisions of Sections 10234.6 and 10234.95. (f) The provisions of this section are applicable to all individual and group policies issued in this state on or after July 1, 2002. (Amended by Stats. 2016, Ch. 304, Sec. 15. (AB 2884) Effective January 1, 2017.)
  121. 10236.14.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    Premium rate schedule increases for long-term care insurance are allowed only if the filing meets specified actuarial requirements and commissioner approval rules.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10236.14. Approval of all premium rate schedule increases shall be subject to the following requirements: (a) (1) Premium rate schedule increases shall demonstrate that the sum of the accumulated value of incurred claims, without the inclusion of active life reserves, and the present value of future projected incurred claims, without the inclusion of active life reserves, will not be less than the sum of the following: (A) The accumulated value of the initial earned premium times the maximum of both of the following: (i) 58 percent. (ii) The lifetime expected loss ratio calculated using the initial pricing assumption, actual distribution of policies issued, and the discount rate provided by subdivision (c). (B) Eighty-five percent of the accumulated value of prior premium rate schedule increases on an earned basis. (C) The present value of future projected initial earned premiums times the maximum of both of the following: (i) 58 percent. (ii) The lifetime expected loss ratio calculated using the initial pricing assumption, actual distribution of policies issued, and the discount rate provided by subdivision (c). (D) Eighty-five percent of the present value of future projected premiums not in subparagraph (C) on an earned basis. (2) However, if the premiums in any rate revision filing calculated in this manner produce a lifetime expected loss ratio that is less than the highest lifetime expected loss ratio for this policy form in the initial filing or that for requested premium rates in any filing made after January 1, 2013, the insurer shall reduce the premiums in the filing so that the current lifetime expected loss ratio is equal to or greater than the highest initially filed loss ratio or that for requested premium rates filed after January 1, 2013. In the determination of a lifetime expected loss ratio, the margin for moderately adverse experience shall be reflected and shall not be increased unless the manner in which risks are shared between the insurer and block of policies has been changed by this law or any future law or regulation. The determination of the lifetime expected loss ratio shall be based on the actual distribution of policies issued and not any assumed distribution prior to actual sales. (b) In the event the commissioner determines that a premium rate increase is justified due to changes in laws or regulations that are retroactively applicable to long-term care insurance previously sold in this state, a premium rate schedule increase may be approved if the increase provides that 70 percent of the present value of projected additional premiums shall be returned to policyholders in benefits and the other requirements applicable to other premium rate schedule increases are met. (c) All present and accumulated values used to determine rate increases should use the maximum valuation interest rate for contract reserves. If one rate increase filing includes policy forms with different discount rates, separate projections for each discount rate should be prepared and then combined to create the total projection for the filing. (d) No request for a rate increase on any policy form approved under Section 10236.11 shall be approved by the commissioner except as follows: the experience on all similar long-term care policy forms issued in this state by the insurer and its affiliates and retained by the affiliated group that have been approved either prior to approval under, or pursuant to, Section 10236.11 shall be pooled together and the combined experience shall be used as the basis for assumptions that satisfy the requirements in subdivision (a). Those assumptions and requested rate increases may vary by policy form if actuarially appropriate. Similar long-term care policy forms shall be classified into one of the following benefit classifications: nursing facility and residential care facility only, home care only, or comprehensive long-term care benefits. An insurer is not precluded from filing requests for premium rate schedule increases on all of its policy forms if the combined experiences after pooling all applicable policy forms satisfies the requirements of subdivision (a). (e) Notwithstanding any other provision of this section, for applications for rate revisions filed on or after January 1, 2013, the commissioner may approve the application if an insurer demonstrates that the rates are necessary to protect the financial condition of the insurer, including avoidance of further reductions in capital and surplus. (f) The provisions of this section are applicable to all individual and group policies issued in this state on or after July 1, 2002. (Amended by Stats. 2016, Ch. 304, Sec. 16. (AB 2884) Effective January 1, 2017.)
  122. 10236.15.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    Insurers with approved long-term care premium rate increases must file updated projections and a comparison of actual vs. projected results for the next three years, unless the commissioner extends that period.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10236.15. Premium rate schedule increases that have been approved shall be subject to the following: (a) For each rate increase that is implemented, the insurer shall file for approval by the commissioner updated projections, as defined in paragraph (1) of subdivision (b) of Section 10236.13, annually for the next three years and include a comparison of actual results to projected values. The commissioner may extend the period to greater than three years. (b) (1) If the commissioner has determined that the actual experience following a rate increase does not adequately match the projected experience and that the current projections under moderately adverse conditions demonstrate that incurred claims will not exceed proportions of premiums specified in subdivision (a), the commissioner may require the insurer to implement any of the following: (A) Premium rate schedule adjustments. (B) Other measures to reduce the difference between the projected and actual experience. (2) In determining whether the actual experience adequately matches the projected experience, consideration should be given to paragraph (6) of subdivision (b) of Section 10236.13, if applicable. (c) If the commissioner demonstrates, based upon credible evidence, that an insurer has engaged in a persistent practice of filing inadequate premium schedules, the commissioner may, in addition to any other authority of the commissioner under this chapter, and after the insurer is afforded proper notice and due process, prohibit the insurer from filing and marketing comparable coverage for a period of up to five years or from offering all other similar coverages, and may limit marketing of new applications to the products subject to recent premium rate schedule increases. (d) This section shall not apply to life insurance policies and certificates that accelerate benefits for long-term care. (e) The provisions of this section are applicable to all individual and group policies issued in this state on or after July 1, 2002. (Amended by Stats. 2016, Ch. 304, Sec. 17. (AB 2884) Effective January 1, 2017.)
  123. 10236.2.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    A group contract can override this rule; otherwise, subdivisions (d) and (e) of Section 10236.1 apply to all group long-term care insurance policies issued before premium rate schedules are approved under Section 10236.11.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10236.2. Except where the provisions of a group contract provide otherwise, the provisions of subdivisions (d) and (e) of Section 10236.1 shall apply to all group long-term care insurance policies issued before the approval of premium rate schedules under Section 10236.11. (Added by Stats. 2012, Ch. 627, Sec. 4. (AB 999) Effective January 1, 2013.)
  124. 10236.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    Group insurance certificates must include continuation or conversion coverage when coverage ends, unless a stated exception applies.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10236.5. (a) Every certificate of group insurance issued or delivered in California shall provide for continuation or conversion coverage for the certificate holder if the group coverage terminates for any reason except the following reasons: (1) The termination of group coverage resulted from the insured’s failure to make any required payment of premium or contribution when due. (2) The terminating coverage is replaced not later than 31 days after termination by new group coverage effective on the day following the termination and the replacement coverage meets both of the following criteria: (A) The replacement coverage provides benefits identical to, or benefits determined by the commissioner to be substantially equivalent to or in excess of, those provided by the terminating coverage. (B) The premium for the replacement coverage is calculated on the insured’s age at the time of issue of the group certificate for the coverage which is being replaced. If the coverage being replaced has itself replaced previous group coverage, the premium for the newest replacement coverage is calculated on the insured’s age at the time the previous group certificate was issued. (b) “Continuation coverage” means the maintenance of coverage under an existing group policy when that coverage would be or has been terminated and which is subject only to continued timely payment of the premium. Any insured individual whose eligibility for group coverage is based on his or her relationship to another person, shall be entitled to continuation coverage under the group policy if the qualifying relationship terminates by dissolution of marriage or death. (c) “Conversion coverage” means an individual policy of long-term care insurance, issued by the insurer of the terminating group coverage, without considering insurability, containing benefits which are identical, or which have been determined by the commissioner to be at least substantially equivalent, to the group coverage which would be or has been terminated for any reason. In determining whether benefits are substantially equivalent, the commissioner shall consider, if applicable, the relative advantages of managed care plans which use restricted provider networks, considering items such as service availability, benefit levels, and administrative complexity. The premium for the converted policy shall be calculated on the insured’s age at the time the group certificate was issued. If the terminating group coverage replaced previous group coverage, the premium for the converted policy shall be calculated on the insured’s age at the time the previous group certificate was issued. Before issuing conversion coverage, the insurer may require, if adequate notice is provided to certificate holders in the certificate, that: (1) The individual must have been continuously insured under the group policy, or any group policy which it replaced, for at least six months immediately prior to termination in order to be entitled to conversion coverage. (2) The insured must submit written application for a conversion policy within a reasonable period after termination of the group coverage, and the premium paid as directed by the insurer, in order that the conversion policy be issued effective on the day following termination of group coverage. (3) The conversion policy contains a provision for a reduction of benefits if the insured has existing long-term care insurance, payable on an expense-incurred basis, which, together with the conversion policy, would result in payment of more than 100 percent of incurred expenses. This provision shall not be included in the conversion policy unless the reduction in benefits is reflected in a premium decrease or refund. (4) The conversion policy contains a provision limiting the payment for a single claim, spell of illness, or benefit period occurring at the time of conversion, to the amount that would have been payable had the group coverage remained in effect. (Added by Stats. 1992, Ch. 1132, Sec. 35. Effective January 1, 1993.)
  125. 10236.8.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. )

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    If a group long-term care policy is replaced, the replacing insurer must keep coverage and pricing rules tied to the prior policy and cannot add new preexisting-condition barriers or vary benefits/premium based on health-related factors.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 4. Implementation [10235 - 10236.15] ( Article 4 added by Stats. 1989, Ch. 767, Sec. 2. ) ## 10236.8. If a group long-term care policy is replaced by another policy to the same master policyholder issued, the replacing insurer shall do all of the following: (a) Provide benefits identical to the terminating coverage or benefits determined by the commissioner to be at least substantially equivalent to the terminating coverage. Lesser or greater benefits may be provided if the commissioner determines the replacement coverage is the most advantageous choice for the beneficiaries. (b) Calculate the premium on the insured’s age at the time of issue of the group certificate for the coverage which is being replaced. If the coverage being replaced has itself replaced previous group coverage, the premium for the newest replacement coverage shall be calculated on the insured’s age at the time the previous group certificate was issued. If the replacement coverage adds new or increased benefits, the premium for the new or increased benefits may be calculated on the insured’s age at the time of replacement. (c) Offer coverage to all persons covered under the replaced group policy on its date of termination. (d) Not exclude coverage for preexisting conditions if the terminating group coverage would provide benefits for those preexisting conditions. (e) Not require new waiting periods, elimination periods, probationary periods, or similar preconditions related to preexisting conditions. The insurer shall waive any such time periods applicable to preexisting conditions to the extent that similar preconditions have been satisfied under the terminating group coverage. (f) Not vary the benefits or the premium based on the insured’s health, disability status, claims experience, or use of long-term care services. (Added by Stats. 1992, Ch. 1132, Sec. 36. Effective January 1, 1993.)
  126. 10237.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 5. Inflation Escalator and Benefit Increases [10237 - 10237.6] ( Article 5 added by Stats. 1990, Ch. 530, Sec. 3. )

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    This article applies to all long-term care insurance policies delivered or issued for delivery in this state on or after January 1, 1991.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 5. Inflation Escalator and Benefit Increases [10237 - 10237.6] ( Article 5 added by Stats. 1990, Ch. 530, Sec. 3. ) ## 10237. This article applies to all long-term care insurance policies delivered or issued for delivery in this state on or after January 1, 1991. (Added by Stats. 1990, Ch. 530, Sec. 3.)
  127. 10237.1.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 5. Inflation Escalator and Benefit Increases [10237 - 10237.6] ( Article 5 added by Stats. 1990, Ch. 530, Sec. 3. )

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    Insurers must offer long-term care policyholders and certificate holders inflation protection options when issuing coverage, and a group-policy exception applies if the group policyholder declines the offer.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 5. Inflation Escalator and Benefit Increases [10237 - 10237.6] ( Article 5 added by Stats. 1990, Ch. 530, Sec. 3. ) ## 10237.1. No insurer may deliver or issue for delivery a long-term care insurance policy or certificate in this state unless the insurer offers to each policyholder and certificate holder, in addition to any other inflation protection, the option to purchase a long-term care insurance policy or certificate that provides for benefit levels and benefit maximums to increase to account for reasonably anticipated increases in the costs of long-term care services covered by the policy. Insurers shall offer to each policyholder and certificate holder, at the time of purchase, the option to purchase a long-term care insurance policy or certificate containing an inflation protection feature which is no less favorable than one that does one or more of the following: (a) Increases benefit levels annually in a manner so that the increases are compounded annually at a rate of not less than 5 percent. (b) Guarantees the insured individual the right to periodically increase benefit levels without providing evidence of insurability or health status and without regard to claim status or history so long as the option for the previous period has not been declined. The amount of the additional benefit shall be no less than the difference between the existing policy benefit and that benefit compounded annually at a rate of at least 5 percent for the period beginning with the purchase of the existing benefit and extending until the year in which the offer is made. (c) Covers a specified percentage of actual or reasonable charges and does not include a maximum specified indemnity amount limit. (d) The insurer of a group long-term care insurance policy as defined in subdivision (a), (b), or (c) of Section 10231.6, shall offer the holder of the group policy the opportunity to have the inflation protection pursuant to this section extended to existing certificate holders, but the insurer is relieved of the obligations imposed by this section if the holder of the group policy declines the insurer’s offer. (Amended by Stats. 1999, Ch. 947, Sec. 16. Effective January 1, 2000.)
  128. 10237.2.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 5. Inflation Escalator and Benefit Increases [10237 - 10237.6] ( Article 5 added by Stats. 1990, Ch. 530, Sec. 3. )

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    When a policy is issued to a group, the required offering from Section 10237.1 must be made to the group policyholder, except in certain group policies where it must be made to each proposed certificate holder.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 5. Inflation Escalator and Benefit Increases [10237 - 10237.6] ( Article 5 added by Stats. 1990, Ch. 530, Sec. 3. ) ## 10237.2. If the policy is issued to a group, the required offering in Section 10237.1 shall be made to the group policyholder; except that if the policy is issued to a group as defined in subdivision (d) of Section 10231.6, other than to a continuing care retirement community, the offering shall be made to each proposed certificate holder. (Added by Stats. 1990, Ch. 530, Sec. 3.)
  129. 10237.3.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 5. Inflation Escalator and Benefit Increases [10237 - 10237.6] ( Article 5 added by Stats. 1990, Ch. 530, Sec. 3. )

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    Section 10237.1’s offer requirement does not apply to certain long-term care-related insurance policies.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 5. Inflation Escalator and Benefit Increases [10237 - 10237.6] ( Article 5 added by Stats. 1990, Ch. 530, Sec. 3. ) ## 10237.3. The offer in Section 10237.1 shall not be required of any of the following: (a) Life insurance policies or riders containing accelerated long-term care benefits. (b) Expense incurred long-term care insurance policies. For purposes of this subdivision, “expense incurred” does not include policies paying a certain percentage of reasonable and customary charges up to a specified, indemnity-type maximum amount. (Added by Stats. 1990, Ch. 530, Sec. 3.)
  130. 10237.4.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 5. Inflation Escalator and Benefit Increases [10237 - 10237.6] ( Article 5 added by Stats. 1990, Ch. 530, Sec. 3. )

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    Insurers offering inflation protection with automatic benefit increases must include a premium expected to stay constant and clearly disclose that premiums may change unless guaranteed constant; benefit increases cannot be reduced because claims were paid.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 5. Inflation Escalator and Benefit Increases [10237 - 10237.6] ( Article 5 added by Stats. 1990, Ch. 530, Sec. 3. ) ## 10237.4. (a) Inflation protection benefit increases under a policy that contains these benefits shall continue without regard to an insured’s age, claim status or claim history, or the length of time the person has been insured under the policy. (b) An offer of inflation protection that provides for automatic benefit increases shall include an offer of a premium which the insurer expects to remain constant. The offer shall disclose in a conspicuous manner that the premium may change in the future unless the premium is guaranteed to remain constant. (c) The inflation protection benefit increases under a policy or certificate that contains an inflation protection feature shall not be reduced due to the payment of claims. (Amended by Stats. 1999, Ch. 947, Sec. 17. Effective January 1, 2000.)
  131. 10237.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 5. Inflation Escalator and Benefit Increases [10237 - 10237.6] ( Article 5 added by Stats. 1990, Ch. 530, Sec. 3. )

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    Long-term care insurance policies must include annual inflation protection increasing benefits by at least 5% compounded annually, unless the policyholder signs a rejection.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 5. Inflation Escalator and Benefit Increases [10237 - 10237.6] ( Article 5 added by Stats. 1990, Ch. 530, Sec. 3. ) ## 10237.5. (a) An inflation protection provision that increases benefit levels annually in a manner so that the increases are compounded annually at a rate not less than 5 percent shall be included in a long-term care insurance policy unless an insurer obtains a rejection of inflation protection signed by the policyholder. (b) The rejection, to be included in the application or on a separate form, shall state: “I have reviewed the outline of coverage and the graphs that compare the benefits and premiums of this policy with and without inflation protection. Specifically, I have reviewed the plan, and I reject 5 percent annual compound inflation protection. Signature of Applicant Date” (Amended by Stats. 1999, Ch. 947, Sec. 18. Effective January 1, 2000.)
  132. 10237.6.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 5. Inflation Escalator and Benefit Increases [10237 - 10237.6] ( Article 5 added by Stats. 1990, Ch. 530, Sec. 3. )

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    An insurer must include specified benefit-comparison and premium information in or with the outline of coverage.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 2.6. Long-Term Care Insurance [10231 - 10237.6] ( Chapter 2.6 added by Stats. 1988, Ch. 1342, Sec. 1. ) ## ARTICLE 5. Inflation Escalator and Benefit Increases [10237 - 10237.6] ( Article 5 added by Stats. 1990, Ch. 530, Sec. 3. ) ## 10237.6. (a) An insurer shall include the following information in or with the outline of coverage: (1) A graphic comparison of the benefit levels of a policy that increases benefits at a compounded annual rate of not less than 5 percent over the policy period with a policy that does not increase benefits. The graphic comparison shall show benefit levels over at least a 20-year period. (2) Any expected premium increases or additional premiums to pay for automatic or optional benefit increases. (b) An insurer may use a reasonable hypothetical or graphic demonstration for purposes of this disclosure. (Added by Stats. 1997, Ch. 699, Sec. 22. Effective October 6, 1997.)
  133. 1024.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. )

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    In certain insurer liquidations, the commissioner must list people who have not filed proofs of claim and note the amounts owed to them within 30 days after the claims deadline.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. ) ## 1024. Unless such claim is filed in the manner and within the time provided in section 1021, it shall not be entitled to filing or allowance, and no action may be maintained thereon. In the liquidation, pursuant to the provisions of this article, of any domestic insurer which has issued policies insuring the lives of persons, the commissioner shall, within thirty days after the last day set for the filing of claims, make a list of the persons who have not filed proofs of claim with him and to whom, according to the books of said insurer, there are amounts owing under such policies, and he shall set opposite the name of each person the amount so owing to such person. Each person whose name shall appear upon said list shall be deemed to have duly filed, prior to the last day set for the filing of claims, a claim for the amount set opposite his name on said list. (Amended by Stats. 1935, Ch. 291.)
  134. 10240.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. )

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    This section defines a “funeral insurance contract” as a life policy tied to an agreement to embalm or dispose of remains, or to pay or provide funds for that purpose, for a person who was alive when the policy was issued.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. ) ## 10240. A “funeral insurance contract” is a life policy embodying an agreement, for a valuable consideration, to embalm or dispose of, or expressly to procure or pay or to provide funds for, in whole or in part, the embalming or disposal of the remains of any person living at the time of the issuance of such policy. (Repealed and added by Stats. 1947, Ch. 557.)
  135. 10242.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. )

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    This chapter applies to funeral insurance contracts issued or delivered in this state for the life of a person in this state, and to insurers issuing or delivering those contracts here.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. ) ## 10242. The provisions of this chapter shall apply to all funeral insurance contracts issued or delivered in this State upon the life of any person in this State and to any insurer issuing or delivering such contracts in this State upon the life of any person in this State. (Repealed and added by Stats. 1947, Ch. 557.)
  136. 10244.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. )

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    Funeral insurance contracts issued in this state must include specified policy protections and disclosures, and insurers must follow payment, proof, and beneficiary rules.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. ) ## 10244. Anything in this code or elsewhere to the contrary notwithstanding, no funeral insurance contract shall be issued or delivered in this State upon the life of any person in this State unless it contains in substance the following provisions: (1) A provision that the insured, after three months’ premiums have been paid, is entitled to a period of grace not less than 30 days within which to make payment of any subsequent premium, subject to the option of the insurer to make an interest charge, not in excess of 6 percent per annum, for the number of days of grace elapsing before the payment of the premium; during said period of grace the policy shall continue in full force. But in case the policy becomes a claim during the said period, the amount of such unpaid premiums, with interest thereon, may be deducted from the amount payable under the policy in settlement thereof. (2) A provision that the policy shall be incontestable after it has been in force during the lifetime of the insured for a period of two years from its date of issue or from the date of any reinstatement thereof except for suicide, nonpayment of premiums or the violation of the conditions of the policy relating to military or naval service in time of war. (3) A provision that the policy, the application therefor and any rider attached to the policy, shall constitute the entire contract between the parties; a copy of such application shall be endorsed upon or attached to the policy when issued. An application for reinstatement, if any, shall be a part of said contract even though not attached thereto. Such policy shall not incorporate therein, by reference or otherwise, the constitution, by-laws, or rules or regulations of any organization whatsoever. No insurer or society, including any society operating under Chapter 10 of Part 2 of Division 2 of this code, operating under any law which requires such incorporation shall issue or deliver funeral insurance contracts in this State. (4) A provision that all statements made by the insured in his application for the policy or reinstatement thereof, shall, in the absence of fraud, be deemed representations and not warranties. (5) A provision that if the age of the insured has been misstated in the policy or application thereof, the amount payable under the policy shall be such as the premium provided for therein would have purchased at the correct age. (6) A provision that before the insurer may pay the proceeds of such policy or any portion thereof to any undertaker or funeral director designated in the policy for funeral services or miscellaneous expenses in connection therewith, the insurer shall require proof satisfactory to it that the services and expenses have been rendered and if proof of rendition of services and expenses is not furnished within 30 days after demand is made upon the insurer for such payment and in any event within one year from the date of the insured’s death, the insurer shall pay the proceeds of such insurance to the beneficiary designated in the policy, and if no beneficiary is so designated, to the estate of the insured or to any person, other than to such undertaker or funeral director, appearing to the insurer to be equitably entitled to all or any portion of the proceeds by reason of having incurred expense or furnished funeral services for the insured, to the extent of the expense incurred or services furnished. (7) A provision granting the insured the right at any time during his lifetime to change the funeral director designated in the policy, if one be designated. (8) If an insurer issuing any such funeral insurance contract is subject to a provision in the laws under which it operates or in its constitution or charter, to the effect that any person purchasing such contract would be subject to additional assessments, premiums or calls other than the premium stated in the contract, then that fact shall be prominently displayed on the application for, and in such contract when issued. (Added by Stats. 1947, Ch. 557.)
  137. 10246.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. )

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    All funeral insurance contracts are subject to the rules in specified sections of the Insurance Code.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. ) ## 10246. All funeral insurance contracts shall be subject in all respects to the provisions of Sections 10150 to 10167 inclusive, and of Sections 10478 to 10489.6 inclusive of this code. (Added by Stats. 1947, Ch. 557.)
  138. 10247.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. )

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    Limited death benefit insurance contracts may be issued and delivered in this state for a person in this state who makes premium payments over time to buy a funeral insurance policy.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. ) ## 10247. Limited death benefit insurance contracts may be issued and delivered in this state upon the life of any person in this state who makes premium payments over a period of time to purchase a funeral insurance policy. Those policies shall be subject to the disclosure requirements of this chapter. (Added by Stats. 1995, Ch. 340, Sec. 1. Effective January 1, 1996.)
  139. 10248.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. )

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    A funeral insurance contract generally may not reduce benefits below the policy’s face amount, subject to stated exceptions. A limited death benefit insurance contract issued under Section 10247 may have a limited death benefit period of no more than two years.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. ) ## 10248. (a) Except as permitted in Section 10247, no funeral insurance contract issued or delivered in this state upon the life of any person in this state shall contain any provision scaling down or reducing the benefits payable below the face amount of the policy. The provisions of this section, however, shall not apply to a reduction of the benefit payable because of a misstatement of the age in the policy or application therefor, nor to the suicide, military or naval service or war provisions of the policy, if any, nor to contestability of the policy, nor to a policy issued on the life of a juvenile. (b) If a limited death benefit insurance contract is issued under Section 10247, the limited death benefit period shall not exceed two years. (Amended by Stats. 1995, Ch. 340, Sec. 2. Effective January 1, 1996.)
  140. 1025.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. )

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    Certain unliquidated or undetermined claims must be filed on time, but they cannot share in creditor distributions until they are definitely determined, proved, and allowed.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. ) ## 1025. Claims founded upon unliquidated or undetermined demands must be filed within the time limit provided in this article for the filing of claims, but claims founded upon such demands shall not share in any distribution to creditors of a person proceeded against under section 1016 until such claims have been definitely determined, proved and allowed. Thereafter, such claims shall share ratably with other claims of the same class in all subsequent distributions. An unliquidated or undetermined claim or demand within the meaning of this article shall be deemed to be any such claim or demand upon which a right of action has accrued at the date of the order of liquidation and upon which the liability has not been determined or the amount thereof liquidated. (Amended by Stats. 1939, Ch. 934.)
  141. 1025.5.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. )

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    The commissioner may allow one claim to be filed instead of separate claims for certain return-premium claims.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. ) ## 1025.5. Notwithstanding the provisions of Sections 1021 to 1025, inclusive, the commissioner may, in lieu of requiring claimants to file separate claims: (a) File a claim himself or herself on behalf of all claimants for return premiums. (b) Permit any assignee of the right of the insured to a return premium by virtue of a valid assignment, as security or otherwise, made prior to an order under Section 1011 or a seizure under Section 1013, whichever is earlier in time in the particular case, to file one claim as assignee on behalf of all insureds having assigned rights to the assignee, which shall set forth such information as may be required under Section 1023. (c) Permit the California Insurance Guarantee Association under subdivision (b) of Section 1063.4, or the California Life and Health Insurance Guarantee Association under paragraph (1) of subdivision (k) of Section 1067.07 to file one claim, for its association, combining all assigned claims and setting forth the information that the commissioner may require under Section 1023. (Amended by Stats. 2010, Ch. 334, Sec. 1. (SB 1408) Effective September 27, 2010.)
  142. 10250.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. )

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    Funeral insurance contracts may be issued or delivered in this State only by an admitted insurer that issues policies on a legal reserve basis.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. ) ## 10250. No funeral insurance contract shall be issued or delivered in this State except by an admitted insurer issuing policies on a legal reserve basis. (Added by Stats. 1947, Ch. 557.)
  143. 10252.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. )

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    A person may not sell or offer for sale a funeral insurance contract in California unless licensed as a life agent under Chapter 5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 3. Burial Contracts [10240 - 10252] ( Chapter 3 enacted by Stats. 1935, Ch. 145. ) ## 10252. No person shall sell or offer for sale any such funeral insurance contract in this state unless he or she is licensed as a life agent pursuant to the provisions of Chapter 5 (commencing with Section 1621). (Amended by Stats. 1982, Ch. 454, Sec. 106.)
  144. 1026.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. )

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    A person with a covered claim against an insured may file that claim in the insurer’s liquidation proceeding if the insurer has been adjudged insolvent, even if the claim is not yet determined or liquidated.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. ) ## 1026. Whenever any person has a cause of action against an insured and such cause is covered by a liability policy, such person, if the insurer is adjudged insolvent, may file a claim in the liquidation proceeding even if the claim is undetermined or unliquidated. (Amended by Stats. 1935, Ch. 291.)
  145. 1026.1.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. )

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    An insured may be subrogated to a third party claimant’s rights after a paid or satisfied insurance claim, if the required proof is filed with the liquidator.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. ) ## 1026.1. Where a claim arising out of a policy of insurance has been filed by a third party and approved by the liquidator and such claim has subsequently been paid or satisfied, either wholly or in part, by the transfer of anything of value, either voluntarily or by process, from the insured of the person in liquidation to such third party, then upon the filing with the liquidator of proof of the making and value of such transfer, to the extent and in the manner required by the liquidator, the insured shall be subrogated to the rights of the third party claimant to the extent that the claim has been satisfied and discharged, but the rights of the insured shall not exceed the face value of such claim and if the insured has theretofore filed a claim covering the same subject matter, he is entitled to only one recovery. (Added by Stats. 1941, Ch. 271.)
  146. 1027.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. )

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    A liquidator may allow certain third-party insurance-policy claims without a prior judgment if the proof supports likely recovery, and must handle distributions when multiple claims exceed the policy or bond limit.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. ) ## 1027. A claim by a third party founded upon an insurance policy may be allowed by the liquidator without requiring such claim to be reduced to judgment, provided it can be reasonably inferred from the proof presented that the claimant would be able to obtain a judgment upon his cause of action against the insured and that such judgment would represent a liability of the person in liquidation under the policy of insurance upon which such claim is founded. In the event several claims founded upon one policy or bond are filed, and the aggregate amount of such claims exceeds the liability limit of said policy or bond, and one or more of such claims is unliquidated and undetermined, then all of such claims shall be deemed unliquidated and undetermined; provided, however, that should one or more of said claims become determined and proved within the time provided in this article, the liquidator, upon any distribution to creditors, shall impound the distribution percentage of the face amount of said claim or claims so determined and proved, not exceeding the policy or bond limit, and upon such claim or claims becoming liquidated as to amount, the liquidator shall release to such claimant the distribution percentage of the final liquidated value of such claims out of the funds so impounded. (Amended by Stats. 1935, Ch. 291.)
  147. 10270.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section says the chapter does not apply to workers’ compensation, liability insurance, or reinsurance, and it applies to selected group disability insurance and certain multi-person insurance types with listed exemptions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270. (a) This chapter shall not apply to workers’ compensation insurance, any policy of liability insurance with or without supplementary coverage, or any policy or contract of reinsurance. (b) This chapter shall apply to selected group disability insurance as defined in Section 10270.97, except insofar as it is exempted from Section 10401. (c) This chapter shall apply to each of the types of insurance enumerated in this subdivision that insure more than one person, except to the extent that the type of insurance may be exempted from compliance with particular portions of this chapter by the provisions of this chapter relating to that type of insurance. The types of insurance that insure more than one person and that are hereby exempted from subdivision (c) of Section 10320 (but family expense disability insurance only to the extent therein provided), and Section 10401 (but only to the extent in this chapter provided) are: (1) Blanket insurance, as defined in subdivision (a) of Section 10270.2. (2) Tuition refund insurance, as defined in Section 10270.1. (3) Group disability insurance, as defined in Sections 10270.5, 10270.505, and 10270.57. (4) Family expense disability insurance, as defined in Section 10270.7. (5) Unemployment compensation disability insurance, as defined in paragraph (6) of subdivision (a) of Section 10270.2. (Amended by Stats. 2018, Ch. 231, Sec. 15. (AB 2045) Effective January 1, 2019.)
  148. 10270.1.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section defines tuition refund insurance and limits when it can be issued, including commissioner approval and some special treatment for coverage for 10 or more students or campers.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.1. (a) As used in this section: (1) “Institution” means any school, college or other institution of learning or the principal or head thereof. “Camp” means one or more tents, vehicles, buildings or structures together with the tract of land appertaining thereto, established or maintained as living quarters for temporary occupancy by 10 or more people, and shall include the principal or head thereof. (2) “Student” means any student or pupil or his parent, guardian or other person who pays or becomes obligated to pay the tuition or fee required for registration or attendance at the institution. “Camper” means any person or his parent, guardian or other person who pays or becomes obligated to pay the tuition or fee required for registration or attendance at the camp. (3) “Tuition refund insurance” means any policy which, because of a student’s or camper’s absence from, or inability to register at or attend, an institution or camp, as the case may be, provides for the indemnification of the student or camper for his loss of tuition or fee, or if he has been previously indemnified therefor by the institution or camp, for its reimbursement. (b) Except to the extent provided herein, the other sections of this chapter shall not apply to tuition refund insurance providing coverage for ten (10) or more students or campers. (c) No policy of tuition refund insurance shall be delivered or issued for delivery to any person in this State unless approved as to substance and form by the commissioner. The commissioner may, after notice and hearing, promulgate such reasonable rules and regulations, relating to the substance, form and issuance of such policies, as are necessary or desirable to preserve, insofar as applicable, standards as respects substance, form and issuance comparable to the standards in such respects prescribed by this chapter and applicable to disability policies, and to further the purpose or purposes for which such policies are to be issued. (d) Tuition refund insurance may be issued only to an institution or camp which does not have a similar policy in effect, but its cost may be borne by the student or camper, as the case may be, in which event he may, upon request, obtain from the insurer a copy of the policy. (Amended by Stats. 1957, Ch. 1558.)
  149. 10270.2.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section defines blanket insurance and sets who may be covered, when policies need commissioner approval, and when filed new language must be submitted before issuance.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.2. (a) Blanket insurance is that form of insurance providing coverage for specified circumstances and insuring by description all or nearly all persons within a class of persons defined in a policy issued to a master policyholder, and not by specifically naming the persons covered, by certificate or otherwise, although a statement of the coverage provided may be given, or required by the policy to be given, to eligible persons. The permitted types of blanket insurance are those where the blanket policy is issued to any of the following: (1) A volunteer or governmental fire department, emergency medical services company, or similar volunteer or governmental organization providing benefits to members or participants only in the event of accident incurred while performing actions incident to an activity or operation sponsored or supervised by the department, company, or organization. (2) A college, school, or other institution of learning, a school district or districts or school jurisdictional unit, or to the head, principal, or governing board of an educational unit who or which shall be deemed the policyholder; providing benefits to students without necessarily any restriction as to activity, time, or place, or to teachers, employees, or volunteers, while performing actions incident to special duties, such as at camps, at summer playgrounds, or during tours or excursions; and providing benefits to students, teachers, employees, or volunteers, and spouses and dependents of students, teachers, and employees, for death or dismemberment resulting from accident, or for hospital, medical, surgical, drug, or nursing expenses resulting from accident or sickness. (3) A sports team, camp, sponsor, or proprietor thereof, who shall be deemed the policyholder, providing benefits to sports team participants, campers, employees, officials, supervisors, volunteers, or persons responsible for their support, for death or dismemberment resulting from accident, or for hospital, medical, surgical, or nursing expenses resulting from accident, to those participants, campers, employees, officials, supervisors, volunteers, or persons responsible for their support, or arising out of sickness of those participants, campers, employees, officials, supervisors, volunteers, or persons responsible for their support, provided the accident or the first manifestation of sickness occurs while those participants, campers, employees, officials, supervisors, volunteers, or persons responsible for their support are in or on the buildings or premises of the sports team or camp, being transported between their homes and the sports team or camp, or while at any other place as an incident to sports team- or camp-sponsored activities or while being transported to, from, or between those places. (4) (A) A newspaper, farm paper, magazine, or other periodical publication, which shall be deemed the policyholder, providing benefits for independent contractors, such as carriers, newsboys, dealers, distributors, wholesalers, or others engaged in the sale, distribution, collecting for, or other activities pertaining to the marketing and delivery of the publication, including attendance at a coaching school or participation as a member of a trip organized, supervised, and sponsored as a reward for meritorious service, on account of loss resulting from accident or sickness, the benefit to be payable to the independent contractors or to their parents, guardians, or other persons responsible for their support. (B) When the premium for the insurance is paid by the person insured, the person may, upon request, obtain from the insurer in certificate form a copy of the policy. (5) Any religious, charitable, recreational, educational, athletic, civic organization, or branch thereof, which shall be deemed the policyholder, providing benefits to any group of members, employees, or participants for death or dismemberment or for hospital, medical, surgical, or nursing expenses resulting from accident incurred incident to specific hazards pertaining to any activity or activities or operations sponsored or supervised by, or on the premises of, the policyholder. (6) An employer, a majority of the employees in this state of an employer, or both, upon application, to pay the benefits afforded by a voluntary plan of unemployment compensation disability insurance. Notwithstanding the provisions of Section 10113, the policy may incorporate by reference any of the appropriate provisions of Part 2 (commencing with Section 2601) of Division 1 of the Unemployment Insurance Code and the authorized regulations of the Director of Employment Development. (7) An employer, who shall be deemed the policyholder, providing benefits to any group of workers, dependents, or guests, limited by reference to specified hazards incident to activities or operations of the policyholder, for death or dismemberment, or for hospital, medical, surgical, or nursing expenses, resulting from accident. When the premium for the insurance is paid by the person insured, the person may, upon request, obtain from the insurer in certificate form a copy of the policy. (8) Any common carrier or any operator, owner, or lessor of a means of transportation, who shall be deemed the policyholder, providing benefits to any group of persons who may become lessees or passengers, limited by reference to their travel status on that common carrier or that means of transportation, for death or dismemberment, or for hospital, medical, surgical, or nursing expenses, resulting from accident. When the premium for the insurance is paid by the person insured, the person may, upon request, obtain from the insurer in certificate form a copy of the policy. (9) An entertainment production company, who shall be deemed the policyholder, providing benefits to any group of participants, volunteers, audience members, contestants, or workers for death or dismemberment, or for hospital, medical, surgical, or nursing expenses, resulting from accident while engaged in any activity or operation of the policyholder. When the premium for the insurance is paid by the person insured, the person may, upon request, obtain from the insurer in certificate form a copy of the policy. (b) A “blanket policy” is any disability policy of the nature herein described sold to any of the entities described in paragraphs (1) to (9), inclusive, of subdivision (a) that provides coverage for any group of persons within permitted categories defined in the policy. Policies referred to in paragraph (6) of subdivision (a) shall comply with the provisions of this section specifically referring thereto. Policies referred to in paragraphs (1) to (5), inclusive, or (7) to (9), inclusive, of subdivision (a) may provide that the cost of the insurance coverage shall be borne by either the policyholder, or the individuals insured or their parents or guardians, payable through the policyholder. In the absence of a policy provision excluding coverage for otherwise covered individuals who have not individually enrolled with the policyholder and undertaken to pay all or a specified portion of the premium allocable to the individual, the policy shall provide the described insurance for all who fall within the categories of covered individuals defined in the policy. The policy may, but is not required to, contain provisions requiring a minimum number of participating persons or a minimum percentage of participation before the policy is effective. In the absence of such a provision, coverage shall not be denied any individual otherwise eligible on those grounds. (c) A policy described in paragraphs (1) to (5), inclusive, or (7) to (9), inclusive, of subdivision (a) shall not be issued until approved as to substance and form by the commissioner. The commissioner may, after notice and hearing, promulgate reasonable rules and regulations relating to the substance, form, and issuance of the policies that are necessary or desirable to preserve, insofar as applicable, standards of substance, form, and issuance comparable to the standards prescribed by this chapter that are applicable to other types of disability policies, and to further the purposes for which the policies are issued. (d) A policy described in paragraph (6) of subdivision (a) shall not be issued until approved as to form by the commissioner. The commissioner may, after notice and hearing, promulgate reasonable rules and regulations relating to the form and issuance of the policies that do not affect the substance of the coverage, and that are necessary or desirable to preserve, insofar as applicable, standards of form and issuance comparable to the standards prescribed by this chapter that are applicable to other types of disability policies, and to further the purposes for which the policies are issued. Notwithstanding the provisions of Section 10113, the policy may incorporate by reference any of the appropriate provisions of Part 2 (commencing with Section 2601) of Division 1 of the Unemployment Insurance Code and the authorized regulations of the Director of Employment Development. (e) A policy described in this section shall not constitute workers’ compensation insurance, as defined in Section 109. A policy described in paragraphs (3), (5), (7), (8), or (9) of subdivision (a) shall not be marketed or sold as a substitute for health insurance coverage compliant with the requirements of the federal Patient Protection and Affordable Care Act (Public Law 111-148), as amended by the Health Care and Education Reconciliation Act of 2010 (Public Law 111-152). (f) (1) An insurer that intends to issue a policy of blanket insurance authorized by the amendments to this section pursuant to the act adding this subdivision, or authorized pursuant to Section 10270.2.5, using a policy form previously approved by the commissioner, where the only new language in the policy is the specification of the policyholder, covered persons, or the hazards or activities insured, shall file that new language with the commissioner prior to issuance of the policy. Submissions of documents containing variable text or blanks shall include complete lists of the variable wording or accurate descriptions of the material to be inserted in lieu of the variable wording or in the blanks of these documents. (2) A policy using the new language shall not be issued until either 30 days expires without notice from the commissioner after the new language is filed, or the commissioner gives their written approval prior to that time. If the commissioner at any time notifies the insurer, in writing and specifying the reasons for the opinion, that the filed new language does not comply with the requirements of law, the insurer shall not issue any policy containing that language. (3) This subdivision shall not be construed to provide separate authority for the commissioner to reopen review of previously approved policy forms. (Amended by Stats. 2025, Ch. 558, Sec. 20. (AB 487) Effective January 1, 2026.)
  150. 10270.2.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    The commissioner may add eligible entities for blanket insurance, issue a letter order, and must post that letter order on the Department of Insurance website.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.2.5. (a) In addition to the permitted types of blanket insurance issued to entities described in Section 10270.2, the commissioner may, in his or her discretion, add other entities that may be eligible to purchase blanket insurance for any class of risks relating to benefits for death or dismemberment, or for hospital, medical, surgical, or nursing expenses, resulting from accident which may be properly eligible for blanket insurance. (b) (1) The commissioner may issue a letter order, and shall post the letter order on the Internet Web site of the Department of Insurance, any time he or she exercises discretion pursuant to subdivision (a) to add other entities that may be eligible to purchase blanket insurance. These letter orders shall not be subject to Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. (2) The commissioner may withdraw a letter order issued pursuant to this section in the manner described in subdivision (f) of Section 10291.5. A proceeding under this subdivision shall not be subject to Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code. (Added by Stats. 2012, Ch. 321, Sec. 3. (AB 2084) Effective January 1, 2013.)
  151. 10270.3.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    A policyholder may choose to include either a coordination-of-benefits or nonduplication-of-benefits provision in certain blanket disability policies.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.3. (a) A blanket disability policy of a type permitted under paragraph (2) or (5) of subdivision (a) of Section 10270.2 may include either a coordination of benefits policy provision or a nonduplication of benefits policy provision, at the option of the policyholder. (b) The essential features of any policy under paragraph (2) or (5) of subdivision (a) of Section 10270.2 shall be disclosed to the insured, or the parent or legal guardian of the insured, prior to enrollment in that policy. All disclosures shall state whether or not the benefits payable under the blanket insurance policy are subject to reduction, to the extent provided in the policy, if an individual insured thereunder is entitled to benefits, whether on an indemnity basis or on a provision-of-service basis, for hospital, medical, dental, or surgical expenses under any other valid and collectible individual, group, or blanket insurance policy or contract, hospital or medical service program, or group-practice prepayment plan, except for automobile medical payments insurance. (c) The disclosure material shall be submitted to the commissioner for review with the blanket insurance policy. (Amended by Stats. 2012, Ch. 321, Sec. 4. (AB 2084) Effective January 1, 2013.)
  152. 10270.4.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    A disability insurer may issue group disability and family expense disability policies, but it may issue them only in the forms allowed by this section and Article 6.7.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.4. Any disability insurer may issue policies of group disability insurance and family expense disability insurance as defined in this article but shall not issue any form of policy of group disability insurance, or family expense disability insurance except as prescribed in this article and except as provided in Article 6.7 of Chapter 1 of Part 2 of Division 1. Provided, however, that during the calendar years of 1952 to 1956, inclusive, a policy of family expense disability insurance as defined in Section 10270.7 may either (1) contain the provisions required by Section 10270.8 and those promulgated by the commissioner pursuant to Sections 10270.9 and 10270.93 and be subject to this article and to Section 10291.5 or (2) be filed and approved under Article 2 of this chapter and be subject to such article and to Articles 3a, 4a and 5a of this chapter and contain the provision required by Section 10270.8(b). On and after January 1, 1957 the provisions of this article shall no longer relate to such policies except Section 10270.7 and subdivision (b) of Section 10270.8 and all of such policies shall be subject to the provisions set forth in alternative (2) above, except that such policies need not comply with subsection (c) of Section 10320 if they comply with Section 10270.7. (Amended by Stats. 1963, Ch. 2055.)
  153. 10270.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section defines group disability insurance and sets the conditions it must meet, including who may receive the master policy, minimum group sizes, premium-collection rules, and certificate approval requirements.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.5. Group disability insurance is that form of disability insurance which conforms to all of the following conditions: (a) Written under a master policy, issued to any of the following: (1) The federal or state government, any federal or state agency, political subdivision or district, any public, governmental, or municipal corporation, any unit, agency, or department thereof, any corporation, copartnership or individual employer, or to the trustee of any association of employers, offering insurance to all the employees of the employer or of the employer members of the association or to all of any class or classes thereof determined by conditions pertaining to employment and covering not less than two such employees or those employees together with their dependents or spouses for amounts of insurance based upon some plan which will preclude individual selection by the employee as to the amount of his or her insurance coverage thereunder. (2) A principal eligible to have issued to him or her a policy of group life insurance under the provisions of Section 10203.7 and insuring not less than two agents as defined in that section and eligible thereunder to be insured, or those agents together with their dependents or spouses. (3) Any association having a constitution and bylaws and formed and continuously maintained in good faith for purposes other than that of obtaining insurance, offering insurance to all the eligible members, or class of members, of the association and covering not less than two such members or those members together with their dependents or spouses and not less than 25 percent of all eligible members, or class of members, for amounts of insurance based upon some plan which will preclude individual selection by the member as to the amount of his or her insurance coverage thereunder. If the master policy is to be issued to cover members of labor unions, it may be issued to more than one such union. (4) An association or a trust, or the trustees of a fund established, created, or maintained for the benefit of members of one or more associations. The association or associations shall have at the outset a minimum membership of 100 persons, and shall be organized and maintained in good faith for purposes other than that of obtaining insurance. The association or associations shall have been in active existence for at least two years, and shall have a constitution and bylaws which require regular meetings not less than annually to further purposes of the members. The members shall have voting privileges and representation on the governing board or boards and committees. The policy shall be subject to the following requirements: (A) The policy may insure members of the association or associations, and employees thereof. (B) The premium for the policy shall be paid from funds contributed by the association or associations, or by members, or by both, or from funds contributed by the covered persons, or from both the covered persons and the association. (C) A policy on which no part of the premium is to be derived from funds contributed by the covered persons specifically for the insurance shall insure all eligible persons, except those who, in writing, reject the coverage. (5) Any trustees eligible to have issued to them a policy of group life insurance under the provisions of Section 10202.8 and insuring not less than two employees or members eligible thereunder to be insured or those employees or members together with their dependents or spouses. (6) A school district or districts, the governing board of any school district or districts, a private or parochial school or schools, or the governing board or person in charge of the operation of any private or parochial school or schools, insuring not less than 50 pupils of the school or district and providing benefits to pupils or persons responsible for their support for death or dismemberment resulting from accident or for hospital, medical and surgical expenses resulting from accident to those pupils while they are in or on buildings or premises of the schools or districts during the time the pupils are required to be therein or thereon by reason of their attendance upon a college or a regular day school or any regular day school of a school district or districts or while being transported by the school or schools or district or districts to and from school or other place of instruction or while at any other place as an incident to school-sponsored activities and while being transported to, from and between these places. (b) Transmission or collection of all premiums or premium contributions shall be performed by the policyholder, except where the policy specifies the persons other than the policyholder by whom the transmission or collection shall be made, and in one of the following situations: (1) If the policy covers the employees of more than one employer, the insurer may collect premium contributions from individual employers whose employees are insured or may assist the policyholder in making these collections. If the employees of more than 100 such employers are covered under that policy, it shall state as a separate part of the premium to be charged for the policy the amount to be charged by the insurer for the collection. (2) If the policy covers a group of governmental employees and the governmental unit paying those employees will not transmit their premium contribution after payroll deduction, the insurer may collect from the individual employees. If more than 100 of these employees are covered under that policy, it shall state as a separate part of the premium to be charged for the policy the amount to be charged by the insurer for the collection. (3) If individual members of the group make payment of their share of the premium contribution to the insurer with or without billing or solicitation by the insurer during a period of temporary absence from active work of not exceeding 90 days, the payment may be received without the necessity of any separately stated charge by the insurer. (4) If the policy covers the members of an association, the insurer may collect premium contributions from individual members or may assist the policyholder in making these collections. If more than 100 such members are covered under that policy, it shall state as a part of the premium to be charged for the policy the amount to be charged by the insurer for the collection. (c) There is issued and delivered in accordance with the policy provision required by subdivision (b) of Section 10270.6 an individual certificate setting forth the benefits and the exceptions under, and referring to, the master policy under which the certificate is issued. Those certificates are not subject to the provisions of this chapter relating to the master policy, but the forms thereof shall be submitted to the commissioner for his or her approval and shall not be issued without approval of the forms in the manner provided in the case of the master policy. (Amended by Stats. 2007, Ch. 78, Sec. 4. Effective January 1, 2008.)
  154. 10270.505.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    A group disability insurance form is permitted only if it meets specified conditions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.505. Another permitted form of group disability insurance is that which conforms to all of the following conditions. (1) Covering debtors who are or become obligated to repay an indebtedness in substantially equal installments, or to repay a portion of an indebtedness in substantially equal installments over a year or more and repay a final balance in any amount on a date certain thereafter, to one creditor, as “creditor” is defined in subdivision (3) of Section 779.2. (2) The group numbers not less than 10 new entrants yearly. (3) The amounts insured on any one debtor do not exceed those permitted by Section 779.4. (4) The policy is issued upon application of and made payable to the creditor or his successor in interest and such alternate beneficiaries as are required by Article 5.9 (commencing with Section 779.1) of Chapter 1 of Part 2 of Division 1, and the premiums are paid by or through the creditor. A policy issued under this section shall conform to all applicable provisions of this code. (Amended by Stats. 1969, Ch. 422.)
  155. 10270.507.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    A group disability insurance certificate generally cannot be issued or delivered to a person age 55 or older in this state under an out-of-state group master policy unless the certificate and master policy have been filed with and approved by the commissioner.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.507. Except as provided in Section 10195 with respect to regulation of group Medicare supplemental insurance, and provisions of law regulating group long-term care insurance, no certificate of group disability insurance advertised or marketed to persons in this state shall be issued or delivered on or after January 1, 1989, to any person 55 years of age or older in this state pursuant to a group master insurance policy issued or delivered in another state unless the certificate and master policy have been filed with, and approved by, the commissioner. This section does not apply to policies issued to one or more employers or labor organizations, or to the trustees of funds established by one or more employers or labor organizations, or combination thereof, for employees or former employees, or combination thereof, or for members or former members, or combination thereof, of the labor organization. The commissioner shall adopt regulations necessary to interpret and implement this section. (Added by Stats. 1988, Ch. 1322, Sec. 1.)
  156. 10270.51.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    The state, its political subdivisions, and municipalities may provide certain disability insurance and contribute to the related fund, like a private employer. A county may also let certain district employees join its master policy, subject to Government Code Section 53200.4.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.51. The state and any political subdivisions thereof and any municipality, may provide for the type of insurance set forth in Section 10270.5 of this code the same as any private employer and may contribute to a fund established under such section the same as any private employer. A county may include as persons eligible under its master policy issued pursuant to Section 10270.5, employees of a district located wholly or partially within the county. Such inclusion of district employees is subject to Section 53200.4 of the Government Code. (Amended by Stats. 1968, Ch. 935.)
  157. 10270.55.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section says who may be treated as an “employee” or “member” under certain group disability policies, and limits who can be insured under those policies.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.55. (a) With respect to a policy issued to a corporation, copartnership or individual employer eligible for group insurance pursuant to Section 10270.5, the term “employees” may be deemed to include the officers, managers and employees of subsidiary or affiliated corporations, and the individual proprietors, partners and employees of affiliated individuals and firms, when the business of such subsidiary or affiliated corporations, firms or individuals is controlled by the policyholder through stock ownership, contract or otherwise, or when the policyholder is controlled by affiliated corporations, firms or individuals through stock ownership, contract or otherwise. (b) With respect to a policy issued to a copartnership or individual employer pursuant to Section 10270.5, the term “employees” may be deemed to include the individual proprietor or partners of the policyholder. (c) With respect to a policy issued to a trust pursuant to subdivisions (1) or (4) of subsection (a) of Section 10270.5 the term “employees” may be deemed to include (1) the individual proprietors and partners of any employers which are individual proprietors or partnerships, (2) the employees of an association and (3) the trustee, or trustees, or the employees of the trustee, or trustees, or both, if their duties are principally connected with such trusteeship. (d) With respect to a policy issued to an association pursuant to subdivision (3) of subsection (a) of Section 10270.5 the term “members” may be deemed to include the employees of the association. (e) Nothing contained herein shall permit a director of a corporate employer to become insured under a group policy unless such person is otherwise eligible as a bona fide employee of the corporation by performing services other than the usual duties of a director. (f) Nothing contained herein shall permit an individual proprietor or partner to become insured under a group policy unless he is actively engaged in and devotes a substantial part of his time to the conduct of the business of the proprietor or partnership. (g) Nothing contained herein shall permit any employee to become insured under a group policy unless he is an officer, manager, or employee for compensation of the employer to whom a group policy is issued, or of one or more of the individuals, firms, or corporations specified in subdivision (a), or of the association or trustee or trustees specified in subdivision (c), or of the association specified in subdivision (d). (h) Officers, managers, and employees of a public agency who receive no compensation may be insured under a group policy purchased pursuant to the provisions of Article 1 (commencing with Section 53200) of Chapter 2, Part 1, Division 2, Title 5 of the Government Code. (Amended by Stats. 1972, Ch. 420.)
  158. 10270.57.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section defines one form of group disability insurance and requires insurer approval for individual certificate forms.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.57. Another form of group disability insurance is that form of disability insurance conforming to the following conditions: (a) Written under a master policy issued to the trustee of any self-employed individuals, whether or not they have any employees, all of whom have contracts with the same publisher of a newspaper, for the performance of services for such publisher as independent contractors, offering insurance to such self-employed individuals and to all the employees of any such persons and covering not less than 10 such self-employed individuals and their employees or such individuals and their employees together with their dependents or spouses for amounts of insurance based upon some plan which will preclude individual selection by the eligible person as to the amount of his insurance coverage thereunder; (b) For delivery to each person insured thereunder, other than dependents or spouses of an insured employee or person, there is issued to the holder of the master policy by the insurer an individual certificate setting forth the benefits and the exceptions under, and referring to, the master policy under which the certificate is issued. Such certificates are not subject to the provisions of this chapter relating to the master policy, but the forms thereof shall be submitted to the commissioner for his approval and shall not be issued without such approval of such forms in the manner provided in the case of the master policy. (Added by Stats. 1963, Ch. 1528.)
  159. 10270.6.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    Every group disability master policy must include four specified provisions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.6. Every group disability master policy shall contain the following provisions: (a) A provision that the policy, the application of the policyholder, and the individual applications, if any, of the individuals insured shall constitute the entire contract between the parties, and that all statements made by the policyholder, or by the individuals insured shall, in the absence of fraud, be deemed representations and not warranties, and that no such statement shall be used in defense to a claim under the policy, unless it is contained in a written application; (b) A provision that the insurer will issue to the policyholder for delivery to the individuals insured under such policy, an individual certificate setting forth a statement as to the insurance protection to which he or she is entitled and to whom payable; (c) A provision that to the group or class thereof originally insured shall be added from time to time all new employees, members, or pupils of the policyholder eligible to and applying for insurance in such group or class; (d) A statement that such policy is not in lieu of and does not affect any requirement for coverage by workers’ compensation insurance. (Amended by Stats. 2018, Ch. 231, Sec. 16. (AB 2045) Effective January 1, 2019.)
  160. 10270.63.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    An individual certificate must be individualized, unless it is a no-contribution group policy certificate that clearly states the conditions of eligibility so the covered person can tell when they are insured under the master policy.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.63. An individual certificate shall be individualized, except that in the case of an individual certificate under a group policy which requires no regular contribution toward the payment of the premium to be made by the individuals covered thereunder, such individual certificate need not be individualized if it is in a form setting forth a clear statement of the conditions of eligibility from which the person covered can determine the circumstances under which he is insured under the master policy. An individual certificate shall be deemed to be “individualized,” within the meaning of this section, if it contains either the name of the person covered or some other means of identifying to the individual covered that it is his individual certificate. (Added by Stats. 1955, Ch. 1729.)
  161. 10270.65.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    If a group disability policy pays dividends or refunds premiums, the policyholder must use any excess for the benefit of insured employees or members, or their dependents.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.65. If hereafter any dividend is paid or any premium refunded under any policy of group disability insurance heretofore or hereafter issued, the excess, if any, of the aggregate dividends or premium refunds under such policy over the aggregate expenditures for insurance under such policy made from funds contributed by the policyholder, or by an employer of such insured persons or by union or association to which insured persons belong, including expenditures made in connection with the administration of such policy, shall be applied by the policyholder for the benefit of such insured employees generally or their dependents or insured members generally or their dependents. For the purpose of this section and at the option of the policyholder, “policy” may include all group life and disability insurance policies of the policyholder. (Added by Stats. 1953, Ch. 1746.)
  162. 10270.7.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section defines “family expense disability insurance” and explains how certain expenses and family-status questions are treated under such policies.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.7. Family expense disability insurance is that form of disability insurance insuring more than one person and issued to the head of a family or his spouse indemnifying him, or his spouse, or both, against loss due to disability of one or more persons dependent at the time of issuance upon him, or his spouse, or both, and may include indemnification on account of his own disability and disability of his spouse whether or not either is dependent on the other. Where such a policy provides for payment for expenses incurred, expenses incurred by or upon behalf of any person covered by the policy shall be deemed incurred by the person to whom or at whose direction benefits are payable under the policy. No question as to whether or not any person is the head of the family or his spouse, or is a child or dependent of either shall relieve the insurer of any liability it otherwise would have under the policy. Where such a policy indemnifies a spouse alone or a spouse and the head of the family, references in the policy to the head of the family shall be deemed to refer to or include the spouse. (Amended by Stats. 1951, Ch. 887.)
  163. 10270.8.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    Family expense disability policies must include specified contract and coverage provisions, and the head of the family must notify the insurer when an eligible person is added to the family.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.8. Family expense disability policies shall also contain the following provisions: (a) A provision that the policy and the application, if any, of the head of the family shall constitute the entire contract between the parties, and that all statements made by the head of the family shall, in the absence of fraud, be deemed representations and not warranties, and that no statement shall be used in defense to a claim under the policy, unless it is contained in a written application; (b) A provision that to the family originally insured may be added from time to time all new members of the family eligible for insurance in such family; and that the head of the family shall give the insurer notice of the addition to the family of any person eligible for coverage under the policy. (Amended by Stats. 1955, Ch. 1596.)
  164. 10270.9.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    An insurer generally may not issue or deliver a group disability policy, or provide group disability coverage, until the policy form is filed with and approved by the commissioner.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.9. No group disability policy shall be issued or delivered in this state nor, except as otherwise provided in Sections 10270.91 and 10270.98, shall an insurer provide or agree to provide group disability coverage until a copy of the form of the policy is filed with the commissioner and approved by him in accordance with Article 2 of this chapter as meeting in substance the reasonably applicable provisions and requirements of either Articles 3, 4 and 5 of this chapter or Articles 3a, 4a and 5a of this chapter; provided, however, that the insurer may, at its option, substitute for one or more of such provisions of Articles 4a and 5a corresponding provisions of different wording approved by the commissioner which are in each instance not less favorable in any respect to the policyholder, the certificate holder or the beneficiary. On and after January 1, 1957, no group disability policy shall be issued or delivered in this state unless the form thereof has been approved, as required by this section, as meeting in substance the provisions and requirements of Articles 3a, 4a and 5a of this chapter which are reasonably applicable; provided, however, that the insurer may, at its option, substitute for one or more of such provisions of Articles 4a and 5a corresponding provisions of different wording approved by the commissioner which are in each instance not less favorable in any respect to the policyholder, the certificate holder or the beneficiary. Except as provided by Section 10314, no group disability policy shall be issued or delivered to any person in this state nor shall any endorsement for any such policy be issued which contains any provision contradictory, in whole or in part, of any of the provisions promulgated by the commissioner as being required or optional or alternative provisions to be incorporated into such policy in accordance with the rules promulgated by him for their use. (Amended by Stats. 1967, Ch. 1548.)
  165. 10270.91.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    An insurer may start group disability coverage before policy-form approval if the listed conditions are met, but it must later submit the policy form, accept required revisions, and end coverage if approval is not obtained in time.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.91. An insurer is permitted to provide group disability coverage prior to the approval of the form of the policy if all of the conditions of (a) are met prior thereto and if thereafter it acts as required by (b). (a) The conditions precedent are: (1) The group is one eligible for coverage pursuant to the provisions of this article; and (2) An executed memorandum of insurance has been or is concurrently delivered to the entity which is to become the policyholder containing a provision that unless a policy the form of which has been approved by the commissioner and embodying the coverage has been issued and delivered to the policyholder within 90 days after the date on which the coverage is provided or agreed to be provided, the coverage provided pursuant to such memorandum terminates 120 days after such date, and containing a specification in either complete or summary form of: (i) The class or classes of employees eligible for coverage; (ii) The benefits to be provided; and (iii) The exceptions and reductions to such benefits, if any. (b) An insurer providing coverage pursuant to this section shall: (1) Within 60 days after the date on which the coverage is provided or agreed to be provided submit to the commissioner for approval a policy form drafted to provide the coverage provided by such memorandum and in a good faith attempt to meet all requirements of law; (2) Make such revisions in the policy submitted as the commissioner may lawfully require; and (3) Terminate such coverage in accordance with the provisions of (a) (2) above if approval of such policy is not secured within the time specified therein. Upon written request from the insurer filed within 50 days after the date on which the coverage is provided or agreed to be provided and upon proof satisfactory to him that the insurer is acting with due diligence and that hardship will result unless an extension is granted, the commissioner may extend the time set forth in (b) (1) hereof for a period of not to exceed 30 days. Upon such extension, the insurer with the consent of the policyholder may amend the memorandum of insurance referred to in (a) (2) hereof to extend the time within which the policy must be issued and delivered to the policyholder to 30 days after the date to which the commissioner has extended the time within which a policy form must be submitted to him for approval and to extend the date for termination of coverage to 30 days thereafter. Any policy submitted to the commissioner with a letter from the insurer stating that coverage has been provided in accordance with this section shall be automatically approved unless the commissioner disapproves the same within 30 days of the date of its submission to him. (Added by Stats. 1953, Ch. 624.)
  166. 10270.92.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    The commissioner may suspend or revoke an insurer’s permission under Section 10270.91 after notice and hearing if the insurer has committed one of several specified misconducts.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.92. The commissioner may suspend or revoke the permission granted any insurer in Section 10270.91 if, after notice and hearing in accordance with Chapter 5 of Part 1 of Division 3 of Title 2 of the Government Code, he finds that the insurer has: (a) Misrepresented the conditional nature of the coverage; (b) Neglected or refused either to cancel or otherwise terminate such coverage within the time required by such section; (c) Delivered any such memorandum which did not comply with subsection (a) (2) of Section 10270.91; (d) Shown a lack of diligence in making revisions in the policy necessary to obtain its approval by the commissioner; (e) Failed so often in so many important respects in drafting any such policy to conform to the applicable requirements of the Insurance Code that a conclusion of lack of good faith or competency in drafting is reasonably justified; (f) Circulated announcements of coverage to individuals insured which failed to advise them of the conditional nature of the coverage; or (g) In any other manner so negligently or carelessly handled the effecting of insurance under Section 10270.91 or the administration thereof that the policyholder or the persons insured have been misled or exposed to the danger of loss. (Added by Stats. 1953, Ch. 624.)
  167. 10270.93.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    A family expense disability policy may not be issued or delivered unless its form is filed with and approved by the commissioner, and the policy must comply with the chapter’s required provisions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.93. No family expense disability policy shall be issued or delivered in this State unless a copy of the form thereof is filed with the commissioner and approved by him in accordance with Article 2 of this chapter as meeting in substance either the provisions and requirements of Articles 3, 4 and 5 of this chapter which are reasonably applicable, or the provisions and requirements of Articles 3a, 4a and 5a of this chapter which are reasonably applicable; provided, however, that the insurer may, at its option, substitute for one or more of such provisions of Articles 4a and 5a corresponding provisions of different wording approved by the commissioner which are in each instance not less favorable in any respect to the insured or the beneficiary. Except as provided by Section 10314, no family expense disability policy shall be issued or delivered to any person in this State nor shall any endorsement for any such policy be issued which contains any provision contradictory, in whole or in part, of any of the provisions promulgated by the commissioner as being required or optional or alternative provisions to be incorporated into such policy, except a policy or endorsement which has been approved by the commissioner under Article 2 of this chapter as meeting the applicable requirements of Articles 2, 3a, 4a and 5a of this chapter and as containing the provisions or substitute provisions as required by Articles 4a and 5a of this chapter modified in such manner as to make the provisions consistent with family expense coverage and the coverage provided in the policy and endorsement, if any. On and after January 1, 1957, no family expense disability policy shall be delivered or issued for delivery to any person in this State unless it complies with Articles 2, 3a, 4a and 5a of this chapter. (Added by Stats. 1953, Ch. 624.)
  168. 10270.94.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    The commissioner must issue specified forms of disability-policy provisions and rules, follow the Government Code procedure, and can later change previously issued provisions or rules.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.94. The commissioner shall promulgate forms of provisions which incorporate in substance the applicable provisions set forth in Articles 4 (commencing with Section 10329), 4a (commencing with Section 10350), 5 (commencing with Section 10359), and 5a (commencing with Section 10369.1), and shall promulgate rules governing the use of those provisions, incorporating the substance, insofar as applicable, of the corresponding rules contained in this chapter for the use of the provisions set forth in Articles 4, 4a, 5, and 5a. However, as of January 1, 1957, the promulgation of provisions and rules governing their use incorporating in substance the applicable provisions of Articles 3 (commencing with Section 10309), 4 (commencing with Section 10329), and 5 (commencing with Section 10359) shall cease to be effective, and on and after January 1, 1957, only the promulgation of provisions and rules governing their use incorporating in substance the applicable provisions of Articles 3a (commencing with Section 10320), 4a (commencing with Section 10350), and 5a (commencing with Section 10369.1) shall be effective. The commissioner may from time to time thereafter change any such provisions or rules governing their use previously promulgated by him or her. The promulgation of any such provisions or rules governing their use and of any changes or amendments thereof shall be in accordance with the procedure provided in Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. (Amended by Stats. 1985, Ch. 106, Sec. 96.)
  169. 10270.95.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    Certain listed disability-insurance provisions do not apply to group disability insurance, and Section 10401 does not apply to family expense disability insurance if families of the same class are not discriminated against.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.95. Without affecting the applicability or degree of applicability of other sections of this chapter, it is hereby specified that the provisions of Sections 10321, 10325, 10401, of subdivisions (a), (c), (e), (h) and (i) of Section 10320, of subdivision (a) of Section 10290, of paragraphs (2), (3), (4), (5), (6), (7), (8), (9), (10), (11) and (12) of subdivision (b) and subdivisions (e), (f), (g), (h), (i), and (k) of Section 10291.5 and of Section 10291.6, shall not apply to group disability insurance. The provisions of Section 10401 shall not apply to family expense disability insurance; provided, there is no discrimination between families of the same class. (Amended by Stats. 1995, Ch. 94, Sec. 1. Effective January 1, 1996.)
  170. 10270.97.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section defines selected group disability insurance and allows insurers to file related rate schedules if they do not discriminate between selected groups.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.97. Selected group disability insurance is that form of disability insurance conforming to the following conditions: (a) Written under individual policies (1) Issued to not less than three employees of the federal or state government, or of any federal or state agency, political subdivision or district, or of any public, governmental, or municipal corporation, or of any unit, agency, or department thereof, or of any corporation, copartnership or individual employer; or (2) Issued to not less than three members of any association, which shall have been in existence for at least two years, having a constitution and bylaws and formed and continuously maintained in good faith for purposes other than that of obtaining insurance; and (3) For amounts of insurance based upon individual selection by the insured employee or member, as the case may be. (b) Notwithstanding the provisions of Section 10401 insurers may be permitted to file (for use in connection with selected group disability insurance), rate schedules that reflect a differential from the rates charged for identical policies issued on the individual basis, provided they do not make or permit any discrimination between selected groups. (Amended by Stats. 1987, Ch. 443, Sec. 2.)
  171. 10270.98.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    Group disability policies may coordinate benefits with other coverage, but most covered policies cannot reduce benefits just because other insurance exists, except in stated cases.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.98. Group disability policies may provide, among other things, that the benefits payable thereunder are subject to reduction if the individual insured has any other coverage (other than individual policies or contracts) providing hospital, surgical or medical benefits, whether on an indemnity basis or a provision of service basis, resulting in such insured being eligible for more than 100 percent of the covered expenses. Except as permitted by this section and by Section 10323, 10369.5, 10369.6, or 11515.5, and except in the case of group practice prepayment plan contracts which do not provide for coordination of benefits, to the extent they provide for a reduction of benefits on account of other coverage with respect to emergency services that are not obtained from providers that contract with the plan, no group or individual disability insurance policy or service contract issued by nonprofit hospital service plans operating under Chapter 11A (commencing with Section 11491) of Part 2 of Division 2 shall limit payment of benefits by reason of the existence of other insurance or service coverage. The policy provisions authorized by this section shall contain a provision that payments of funds may be made directly between insurers and other providers of benefits. Such policy provisions shall also contain a provision that if benefits are provided in the form of services rather than cash payments the reasonable cash value of each service rendered shall be deemed to be both an allowable expense and a benefit paid. The reasonable cash value of any contractual benefit provided to the insured in the form of service rather than cash payment by or through any hospital service organization or medical service organization or group-practice prepayment plan shall be deemed an expense incurred by the insured for such service, whether or not actually incurred, and the liability of the insurer shall be the same as if the insured had not been entitled to any such service benefit, unless the policy contains a provision authorized by Section 10323, 10369.5 or 10369.6 in the case of an individual disability policy, or by this section, in the case of a group disability policy. This section shall not be construed to require that benefits payable under group disability policies be subject to reduction by the benefit amounts payable under Chapter 3 (commencing with Section 2800) of Part 2 of Division 1 of the Unemployment Insurance Code. The provisions of this section, and all regulations adopted pursuant thereto pertaining to coordination of benefits with other group disability benefits, shall apply to all employers, labor-management trustee plans, union welfare plans (including those established in conformity with 29 U.S.C. Sec. 186), employer organization plans or employee benefit organization plans, health care service plan contracts, pursuant to regulations adopted by the Director of the Department of Managed Health Care which shall be uniform with those issued under this section for those plans that elect to coordinate benefits, group practice, individual practice, any other prepayment coverage for medical or dental care or treatment, and administrators, within the meaning of Section 1759 not otherwise subject to the provisions of this section whenever such plan, contract or practice provides or administers hospital, surgical, medical or dental benefits to employees or agents who are also covered under one or more additional group disability policies which are subject to this section or health care service plans. (Amended by Stats. 2000, Ch. 857, Sec. 66. Effective January 1, 2001.)
  172. 10270.99.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section defines “individual policies or contracts” and excludes selected group disability policies or contracts, except in specified cases.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10270.99. The term “individual policies or contracts,” as used in the first paragraph of Section 10270.98, does not include selected group disability policies or contracts, unless those policies or contracts are noncancelable or guaranteed renewable and solely provide hospital confinement indemnity or specified disease coverage. (Amended by Stats. 1987, Ch. 336, Sec. 1.)
  173. 10271.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section limits when disability-policy supplemental benefits are covered and sets required contract terms, claim deadlines, and commissioner approval rules.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10271. (a) Except as set forth in this section and in Sections 10271.1, 10292, and 10295 to 10295.19, inclusive, this chapter does not apply to, or in any way affect, provisions in life insurance, endowment, or annuity contracts, or contracts supplemental thereto, that provide additional benefits in case of death or dismemberment or loss of sight by accident, or that operate to safeguard those contracts against lapse, as described in subdivision (a) of Section 10271.1, or give a special surrender benefit, as defined in subdivision (b) of Section 10271.1, a terminal illness benefit, as defined in subdivision (d) of Section 10271.1, or an accelerated death benefit, as defined in Article 2.1 (commencing with Section 10295), in the event that the owner, insured, or annuitant, as applicable, meets the benefit triggers specified in the life insurance or annuity contract or supplemental contract. (b) For the purposes of this section, “supplemental benefit” means a rider to or provision in a life insurance policy, certificate, or annuity contract that provides a benefit as set forth in subdivision (a). (c) A supplemental benefit described in subdivision (a) shall contain all of the following provisions. However, an insurer, at its option, may substitute for one or more of the provisions a corresponding provision of different wording approved by the commissioner that is not less favorable in any respect to the owner, insured, or annuitant, as applicable. The required provisions shall be preceded individually by the appropriate caption, or, at the option of the insurer, by the appropriate individual or group captions or subcaptions as the commissioner may approve. (1) A life insurance policy or annuity contract that contains a supplemental benefit shall provide that the contract, supplemental contract, and papers attached thereto by the insurer, including the application if attached, constitute the entire insurance or annuity contract and shall also provide that an agent does not have the authority to change the contract or to waive its provisions. This provision shall be preceded individually by a caption stating “ENTIRE CONTRACT; CHANGES:” or other appropriate caption as the commissioner may approve. (2) The supplemental benefit shall provide that reinstatement of the supplemental benefit shall be on the same or more favorable terms as reinstatement of the underlying life insurance policy or annuity contract. Following reinstatement, the insured and insurer shall have the same rights under reinstatement as they had under the supplemental benefit immediately before the due date of the defaulted premium, subject to the provisions endorsed in the rider or endorsement or attached to the rider or endorsement in connection with the reinstatement. This reinstatement provision shall be preceded individually by a caption stating “REINSTATEMENT:” or other appropriate caption as the commissioner may approve. (3) A supplemental benefit subject to underwriting shall include an incontestability statement that provides that the insurer shall not contest the supplemental benefit after it has been in force during the lifetime of the insured for two years from its date of issue, and that the supplemental benefit may only be contested based on a statement made in the application for the supplemental benefit, if the statement is attached to the contract and if the statement was material to the risk accepted or the hazard assumed by the insurer. This provision shall be preceded individually by a caption stating “INCONTESTABILITY:” or other appropriate caption as the commissioner may approve. (4) A supplemental benefit shall contain the provision in subparagraph (A), except that an accelerated death benefit as defined in Article 2.1 (commencing with Section 10295) shall contain the provision in subparagraph (B). (A) The supplemental benefit shall provide either that the insurer may accept written notice of claim at any time or that the insurer may require that written notice of claim be submitted by a due date that is no less than 20 days after an occurrence covered by the supplemental benefit, or commencement of a loss covered by the supplemental benefit, or as soon after the due date as is reasonably possible. Notice given by or on behalf of the insured or the beneficiary, as applicable, to the insurer at the insurer’s address or telephone number, or to an authorized agent of the insurer, with information sufficient to identify the insured, shall be deemed notice to the insurer. This provision shall be preceded individually by a caption stating “NOTICE OF CLAIM:” or other appropriate caption as the commissioner may approve. (B) The accelerated death benefit shall provide either that the insured may give notice of claim at any time or that the insured shall give notice of claim by a due date that is at least 20 days after the insured receives documentation that establishes the occurrence of a qualifying event, or as soon after the due date as is reasonably possible. Notice given by or on behalf of the insured or the beneficiary, as applicable, to the insurer at the insurer’s address or telephone number, or to an authorized agent of the insurer, with information sufficient to identify the insured, shall be deemed notice to the insurer. This provision shall be preceded individually by a caption stating “NOTICE OF CLAIM:” or other appropriate caption as the commissioner may approve. (5) A supplemental benefit shall contain the provision in subparagraph (A), except that an accelerated death benefit as defined in Article 2.1 (commencing with Section 10295) shall contain the provision in subparagraph (B). (A) The supplemental benefit shall provide that the insurer, upon receipt of a notice of claim, shall furnish to the claimant those forms as are usually furnished by it for filing a proof of occurrence or a proof of loss. If the forms are not furnished within 15 days after giving notice, the claimant shall be deemed to have complied with the requirements of the supplemental benefit as to proof of occurrence or proof of loss upon submitting, within the time fixed by the supplemental benefit for filing proof of occurrence or proof of loss, written proof covering the character and the extent of the occurrence or loss. This provision shall be preceded individually by a caption stating “CLAIM FORMS:” or other appropriate caption as the commissioner may approve. (B) The accelerated death benefit shall provide that the insurer, upon receipt of a notice of claim, shall furnish to the claimant any forms required for filing proof of loss. If the forms are not furnished within 15 days after notice of claim is given to the insurer, the claimant shall be deemed to have provided proof of loss upon sending, within the time fixed by the supplemental benefit for filing proof of loss, documentation that establishes the occurrence of a qualifying event. This provision shall be preceded individually by a caption stating “CLAIM FORMS:” or other appropriate caption as the commissioner may approve. (6) A supplemental benefit shall contain the provision in subparagraph (A), except that an accelerated death benefit as defined in Article 2.1 (commencing with Section 10295) shall contain the provision in subparagraph (B). (A) The supplemental benefit shall provide that the insurer may require, in the case of a claim for which the supplemental benefit provides a periodic payment contingent upon continuing occurrence or loss, that the insured provide written proof of occurrence or proof of loss no less than 90 days after the termination of the period for which the insurer is liable, and, in the case of claim for any other occurrence or loss, that the insured provide written proof of occurrence or proof of loss within 90 days after the date of the occurrence or loss. Failure to furnish proof within the time required shall not invalidate or reduce the claim if it was not reasonably possible to give proof within the time, provided proof is furnished as soon as reasonably possible and, except in the absence of legal capacity, no later than one year from the time proof is otherwise required. This provision shall be preceded individually by a caption stating “PROOF OF LOSS:” or other appropriate caption as the commissioner may approve. (B) The accelerated death benefit shall provide that the insured shall send completed claim forms and documentation that establishes the occurrence of a qualifying event within 90 days of receiving that documentation. Failure to send proof within the time required shall not invalidate or reduce the claim as long as proof is sent as soon as reasonably possible and, except in the absence of legal capacity, no later than one year from the time proof is otherwise required. This provision shall be preceded individually by a caption stating “PROOF OF LOSS:” or other appropriate caption as the commissioner may approve. (7) The supplemental benefit shall provide that the insurer, at its own expense, shall have the right and opportunity to examine the person of the insured when and as often as the insurer may reasonably require during the pendency of a claim and to make an autopsy in case of death where it is not forbidden by law. This provision shall be preceded individually by a caption stating “PHYSICAL EXAMINATIONS:” or other appropriate caption as the commissioner may approve. (d) The commissioner shall not approve a contract or supplemental contract for issuance or delivery in this state if the commissioner finds that the contract or supplemental contract does any of the following: (1) Contains a provision, label, description of its contents, title, heading, backing, or other indication of its provisions that is unintelligible, uncertain, ambiguous, or abstruse, or likely to mislead a person to whom the supplemental benefit is offered, delivered, or issued. (2) Constitutes fraud, unfair trade practices, or insurance economically unsound to the owner, insured, or annuitant, as applicable. (3) Contains actuarial information that is materially incomplete, incorrect, or inadequate. (e) A supplemental benefit described in subdivision (a) shall not contain a title, description, or any other indication that would describe or imply that the supplemental benefit provides long-term care coverage. (f) Commencing two years from the date of the issuance of the supplemental benefit, no claim for loss incurred or disability, as defined by the supplemental benefit, may be reduced or denied on the grounds that a disease or physical condition not excluded from coverage by name or specific description effective on the date of loss had existed before the effective date on the coverage of the supplemental benefit. (g) With regard to supplemental benefits set forth in subdivision (a), the supplemental benefit shall specify any applicable exclusions, which shall be limited to the following: (1) Condition or loss caused or substantially contributed to by any attempt at suicide or intentionally self-inflicted injury, while sane or insane. (2) Condition or loss caused or substantially contributed to by war or an act of war, as defined in the exclusion provisions of the contract. (3) Condition or loss caused or substantially contributed to by active participation in a riot, insurrection, or terrorist activity. (4) Condition or loss caused or substantially contributed to by committing or attempting to commit a felony. (5) Condition or loss caused or substantially contributed to by voluntary intake of either: (A) A drug, unless prescribed or administered by a physician and taken in accordance with the physician’s instructions. (B) Poison, gas, or fumes, unless they are the direct result of an occupational accident. (6) Condition or loss in consequence of the insured being intoxicated, as defined by the jurisdiction where the condition or loss occurred. (7) Condition or loss caused or substantially contributed to by engaging in an illegal occupation. (8) Condition or loss caused or substantially contributed to by engaging in aviation, other than as a fare-paying passenger. (h) If the commissioner notifies the insurer, in writing, that the filed form or actuarial information does not comply with the law and specifies the reasons for the commissioner’s opinion, it is unlawful for an insurer to issue a policy in that form. (Amended by Stats. 2021, Ch. 627, Sec. 13. (AB 1511) Effective January 1, 2022.)
  174. 10271.1.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section defines certain disability-policy and life-insurance supplemental benefits and sets limits on when insurers must waive premiums or deductions.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10271.1. (a) (1) Supplemental benefits that operate to safeguard life insurance contracts against lapse are defined as a waiver of premium benefit or a waiver of monthly deduction benefit, as applicable, in which the insurer waives the premium or monthly deduction for a life insurance contract when the insured becomes totally disabled, as defined by the supplemental benefit, and where the waiver continues until the end of the insured’s disability, or for the period specified by the supplemental benefit, consistent with paragraph (5). (2) For purposes of this subdivision, total disability shall not be less favorable to the insured than the following: (A) During the first 24 months of total disability, the insured is unable to perform with reasonable continuity the substantial and material duties of their job due to sickness or bodily injury. (B) After the first 24 months of total disability, the insured, due to sickness or bodily injury, is unable to engage with reasonable continuity in any other job in which they could reasonably be expected to perform satisfactorily in light of their age, education, training, experience, station in life, or physical and mental capacity. (3) The definition of total disability may also include presumptive total disability, such as the insured’s total and permanent loss of sight of both eyes, hearing of both ears, speech, the use of both hands, both feet, or one hand and one foot. (4) The insurer may require total disability to continue for an uninterrupted period of time specified by the supplemental benefit, or the insurer may allow separate periods of disability to be combined. (5) The waiver of premium or monthly deduction benefit shall continue for the period specified by the supplemental benefit, but shall not be less favorable to the insured than the following: (A) If the insured’s total disability begins before the insured attains 60 years of age, the insurer shall waive all premiums or monthly deductions due for the period that the insured continues to be totally disabled, except as follows: (i) For group life insurance policies, if the insured’s total disability begins before the insured attains 60 years of age, the insurer shall waive all premiums or monthly deductions due for the period of total disability up to 65 years of age. This subdivision does not preclude the insurer from extending a supplemental benefit for longer periods. (ii) When a renewal is offered for a group life insurance policy that was issued prior to January 1, 2017, and contains a supplemental benefit described in this subparagraph, the insurer shall offer to renew the policy with a continuation of the in-force supplemental benefit, and may concurrently offer the group policyholder the option to change the supplemental benefit as described in clause (i). (B) If the insured’s total disability begins after the age specified in subparagraph (A), the insurer shall waive all premiums or monthly deductions due for the period that the insured continues to be totally disabled up to 65 years of age, except as follows: (i) For group life insurance policies, if the insured’s total disability begins on or after the date the insured attains 60 years of age, the insurer is not required to waive premiums or monthly deductions. This subdivision does not preclude the insurer from extending a supplemental benefit for longer periods. (ii) When a renewal is offered for a group life insurance policy that was issued prior to January 1, 2017, and contains a supplemental benefit described in this subparagraph, the insurer shall offer to renew the policy with a continuation of the in-force supplemental benefit, and may concurrently offer the group policyholder the option to change the supplemental benefit as described in clause (i). (6) In addition to the permissible exclusions listed in subdivision (g) of Section 10271, the insurer may exclude a total disability occurring after the policy anniversary or supplemental contract anniversary, as applicable and as defined by the supplemental benefit, on which the insured attains a specified age of no less than 65 years. (b) “Special surrender benefit” means a “waiver of surrender charge benefit” wherein the insurer waives the surrender charge usually charged for a withdrawal of funds from the cash value of a life insurance contract or the account value of an annuity contract if the owner, insured, or annuitant, as applicable, meets any of the following criteria: (1) The individual develops a terminal illness, as defined in subdivision (d). (2) The individual is receiving, as prescribed by a physician, registered nurse, or licensed social worker, home care or community-based services, as defined in subdivision (a) of Section 10232.9, or is confined in a skilled nursing facility, convalescent nursing home, or extended care facility, which shall not be defined more restrictively than as in the Medicare program, or is confined in a residential care facility or residential care facility for the elderly, as defined in the Health and Safety Code. Out-of-state providers of services shall be defined as comparable in licensure and staffing requirements to California providers. (3) The individual has any medical condition that would, in the absence of treatment, result in death within a limited period of time, as defined by the supplemental benefit, but that shall not be restricted to a period of less than six months. (4) (A) The individual is totally disabled, as follows: (i) During the first 24 months of total disability, the owner, insured, or annuitant, as applicable, is unable to perform with reasonable continuity the substantial and material duties of their job due to sickness or bodily injury. (ii) After the first 24 months of total disability, the owner, insured, or annuitant, as applicable, due to sickness or bodily injury, is unable to engage with reasonable continuity in any other job in which they could reasonably be expected to perform satisfactorily in light of their age, education, training, experience, station in life, or physical and mental capacity. (B) The definition of total disability may also include presumptive total disability, such as the insured’s total and permanent loss of sight of both eyes, hearing of both ears, speech, the use of both hands, both feet, or one hand and one foot. (C) The insurer may require the total disability to continue for an uninterrupted period of time specified by the supplemental benefit, or the insurer may allow separate periods of disability to be combined. (5) The individual has a chronic illness as defined in either subparagraph (A) or (B): (A) Either of the following: (i) Impairment in performing two out of seven activities of daily living, as set forth in subdivisions (a) and (g) of Section 10232.8, meaning the insured needs human assistance, or needs continual substantial supervision. (ii) The insured has an impairment of cognitive ability, meaning a deterioration or loss of intellectual capacity due to mental illness or disease, including Alzheimer’s disease or related illnesses, that requires continual supervision to protect oneself or others. (B) Either of the following: (i) Impairment in performing two out of six activities of daily living as described in subdivisions (b), (d), (e), and (f) of Section 10232.8 due to a loss of functional capacity to perform the activity. (ii) Impairment of cognitive ability, meaning the insured needs substantial supervision due to severe cognitive impairment, as described in subdivisions (b), (d), and (e) of Section 10232.8. (6) The individual has become involuntarily or voluntarily unemployed. (c) “Supplemental benefit” means a rider to or provision in a life insurance policy, certificate, or annuity contract that provides a benefit as set forth in subdivision (a) of Section 10271. (d) “Terminal illness benefit” means a provision, endorsement, or rider added to a life insurance policy that provides for the advance payment of any part of the death proceeds, payable upon the occurrence of a terminal illness. For the purposes of this chapter, “terminal illness” means a medical condition in which the owner’s, insured’s, or annuitant’s life expectancy is expected to be less than or equal to a limited period of time that shall not be restricted to a period of less than 12 months or greater than 24 months. (Amended by Stats. 2021, Ch. 627, Sec. 14. (AB 1511) Effective January 1, 2022.)
  175. 10272.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    In this chapter, “indemnity” means benefits promised.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10272. The term “indemnity,” as used in this chapter means benefits promised. (Enacted by Stats. 1935, Ch. 145.)
  176. 10273.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section defines “noncancelable policy” and “noncancelable and guaranteed renewable policy,” giving the insured a right to keep the policy in force if premiums are paid on time, and limiting the insurer’s ability to change policy terms while coverage is in force.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10273. The term “noncancelable policy” or “noncancelable and guaranteed renewable policy” as used in this chapter means a policy which the insured has the right to continue in force subject to its terms by the timely payment of premiums in the amount originally set forth in the policy (a) until at least age 50, or (b) in the case of a policy issued after age 44, for at least five years from its date of issue, during which period the insurer has no right to make unilaterally any change in any provision of the policy while the policy is in force. Such a policy may use any of the provisions in Section 10291.6, 10350.2, 10350.4 or 10369.7, which may be used in noncancelable policies. (Amended by Stats. 1961, Ch. 2047.)
  177. 10273.3.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    A guaranteed renewable policy lets the insured keep the policy in force by timely premium payment, and limits the insurer’s ability to change policy terms.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10273.3. The term “guaranteed renewable policy” as used in this chapter (commencing with Section 10270) means a policy which the insured has the right to continue in force subject to its terms by the timely payment of premium (a) until at least age 50, or (b) in the case of a policy issued after age 44, for at least five years from its date of issue during which period the insurer has no right to make unilaterally any change in any provision of the policy while the policy is in force, except that the insurer may, in accordance with the provisions of the policy, make changes in premium rates as to all insureds who were placed in the same class for purposes of rate determination in the process of issuance of the policy or making it guaranteed renewable. Such a policy may use any of the provisions in Section 10291.6, 10350.2, 10350.4 or 10369.7, which may be used in noncancelable policies. (Added by Stats. 1961, Ch. 2047.)
  178. 10273.4.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    Disability insurers must generally keep group health benefit plans renewable, but there are specific exceptions and notice rules.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10273.4. All disability insurers writing, issuing, or administering group health benefit plans shall make all of these health benefit plans renewable with respect to the policyholder, contractholder, or employer except in case of the following: (a) (1) Nonpayment of the required premiums by the policyholder, contractholder, or employer if the policyholder, contractholder, or employer has been duly notified and billed for the premium and at least a 30-day grace period has elapsed since the date of notification or, if longer, the period of time required for notice and any other requirements pursuant to Section 2703, 2712, or 2742 of the federal Public Health Service Act (42 U.S.C. Secs. 300gg-2, 300gg-12, and 300gg-42) and any subsequent rules or regulations has elapsed. (2) Pursuant to paragraph (1), the disability insurer shall continue to provide coverage as required by the policyholder’s, certificate holder’s, or other insured’s policy during the period described in paragraph (1). (b) The insurer demonstrates fraud or an intentional misrepresentation of material fact under the terms of the policy by the policyholder, contractholder, or employer. (c) Violation of a material contract provision relating to employer or other group contribution or group participation rates by the contractholder or employer. (d) The insurer ceases to provide or arrange for the provision of health care services for new group health benefit plans in this state, provided that the following conditions are satisfied: (1) Notice of the decision to cease writing, issuing, or administering new or existing group health benefit plans in this state is provided to the commissioner and to either the policyholder, contractholder, or employer at least 180 days prior to discontinuation of that coverage. (2) Group health benefit plans shall not be canceled for 180 days after the date of the notice required under paragraph (1) and for that business of a plan that remains in force, any disability insurer that ceases to write, issue, or administer new group health benefit plans shall continue to be governed by this section with respect to business conducted under this section. (3) Except as provided under subdivision (h) of Section 10705, or unless the commissioner had made a determination pursuant to Section 10712, a disability insurer that ceases to write, issue, or administer new group health benefit plans in this state after the effective date of this section shall be prohibited from writing, issuing, or administering new group health benefit plans to employers in this state for a period of five years from the date of notice to the commissioner. (e) The disability insurer withdraws a group health benefit plan from the market; provided, that the plan notifies all affected contractholders, policyholders, or employers and the commissioner at least 90 days prior to the discontinuation of the health benefit plans, and that the insurer makes available to the contractholder, policyholder, or employer all health benefit plans that it makes available to new employer business without regard to the claims experience of health-related factors of insureds or individuals who may become eligible for the coverage. (f) If the coverage is offered through a network plan, there is no longer any covered individual in connection with the plan who lives, resides, or works in the service area of the disability insurer. (g) If coverage is made available in the individual market through a bona fide association, the membership of the individual in the association on the basis of which the coverage is provided, ceases, but only if that coverage is terminated under this subdivision uniformly without regard to any health status-related factor of covered individuals. (h) For the purposes of this section, “health benefit plan” shall have the same meaning as in subdivision (a) of Section 10198.6 and Section 10198.61. (i) For the purposes of this section, “eligible employee” shall have the same meaning as in Section 10700, except that it applies to all health benefit plans issued to employer groups of two or more employees. (Amended by Stats. 2010, Ch. 658, Sec. 11. (AB 2470) Effective January 1, 2011.)
  179. 10273.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    A person may not represent a disability policy as noncancelable or guaranteed renewable, and any representation about continuing the policy must include the insurer’s reserved premium-change terms.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10273.5. No person shall cause or permit to be issued, circulated or used any representation that a policy defined in Section 10273.3 is “non-can,” noncancelable (not cancelable) or noncancelable and guaranteed renewable. No person shall cause or permit to be issued, circulated or used any representation concerning the right to continue a policy such as is defined in Section 10273.3 unless such representation contains a declaration of the terms under which the insurer has reserved the right to change the premium in a manner which shall not minimize or obscure the same. Any person knowingly violating any provision of this section shall be subject to the penalties provided for misrepresentation by this code. (Added by Stats. 1961, Ch. 2047.)
  180. 10273.6.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    Individual health benefit plans are generally renewable at the individual’s option, but insurers may refuse renewal or cancel coverage only in specified situations such as nonpayment after notice and a grace period, fraud, moving out of the service area, or certain plan withdrawal/cessation scenarios.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10273.6. All individual health benefit plans shall be renewable with respect to all eligible individuals or dependents at the option of the individual except as follows: (a) (1) Except as otherwise specified in paragraph (3), for nonpayment of the required premiums by the individual if the individual has been duly notified and billed for the premium and at least a 30-day grace period has elapsed since the date of notification or, if longer, the period of time required for notice and any other requirements pursuant to Section 2703, 2712, or 2742 of the federal Public Health Service Act (42 U.S.C. Secs. 300gg-2, 300gg-12, and 300gg-42) and subsequent rules or regulations has elapsed. (2) Pursuant to paragraph (1), the disability insurer shall continue to provide coverage as required by the policyholder’s, certificate holder’s, or other insured’s policy during the period described in paragraph (1). (3) For nonpayment of the required premiums by an individual who receives advance payments of the premium tax credit authorized by Section 36B of the Internal Revenue Code or advanced premium assistance subsidy authorized by Section 100800 of the Government Code, or both, if the individual has been duly notified and billed for the charge and a grace period of three consecutive months has elapsed since the last day of paid coverage. (A) During the first month of the three-month grace period described in paragraph (3), an insurer shall continue to do both of the following: (i) Collect advance payments of the federal premium tax credit or state advanced premium assistance subsidy, or both, on behalf of the insured. (ii) Provide coverage as required by the individual’s policy. (B) If the individual exhausts the three-month grace period described in paragraph (3) without paying all outstanding premiums due, the insurer shall return both of the following: (i) Advance payments of the premium tax credit paid on behalf of the individual for the second and third months of the three-month grace period described in paragraph (3), pursuant to Section 156.270(e)(2) of Title 45 of the Code of Federal Regulations. (ii) The advanced premium assistance subsidy paid on behalf of the individual for the second and third months of the three-month grace period described in paragraph (3), pursuant to subdivision (a) of Section 100805 of the Government Code. (C) An insurer shall comply with all federal and state laws and regulations relating to cancellations, terminations, or nonrenewals of coverage due to nonpayment of premiums by individuals who receive advance payments of the federal premium tax credit or state advanced premium assistance subsidy. For a health insurance contract issued, amended, or renewed on or after January 1, 2020, all requirements applicable to cancellations, terminations, or nonrenewals of coverage due to nonpayment of premiums by individuals who receive advance payments of premium tax credit authorized by Section 36B of the Internal Revenue Code shall apply to cancellations, terminations, or nonrenewals of coverage due to nonpayment of premiums by individuals who receive premium assistance subsidy authorized by Section 100800 of the Government Code. (b) The insurer demonstrates fraud or intentional misrepresentation of material fact under the terms of the policy by the individual. (c) Movement of the individual contractholder outside the service area, but only if coverage is terminated uniformly without regard to a health status-related factor of covered individuals. (d) If the disability insurer ceases to provide or arrange for the provision of health care services for new individual health benefit plans in this state, as long as the following conditions are satisfied: (1) Notice of the decision to cease new or existing individual health benefit plans in this state is provided to the commissioner and to the individual policy or contractholder at least 180 days before discontinuation of that coverage. (2) Individual health benefit plans shall not be canceled for 180 days after the date of the notice required under paragraph (1) and for that business of a disability insurer that remains in force, a disability insurer that ceases to offer for sale new individual health benefit plans shall continue to be governed by this section with respect to business conducted under this section. (3) A disability insurer that ceases to write new individual health benefit plans in this state after the effective date of this section shall be prohibited from offering for sale individual health benefit plans in this state for a period of five years from the date of notice to the commissioner. (e) If the disability insurer withdraws an individual health benefit plan from the market, as long as the disability insurer notifies all affected individuals and the commissioner at least 90 days before the discontinuation of these plans, and the disability insurer makes available to the individual all health benefit plans that it makes available to new individual businesses without regard to a health status-related factor of enrolled individuals or individuals who may become eligible for the coverage. (f) If coverage is made available in the individual market through a bona fide association, and the membership of the individual in the association on the basis of which the coverage is provided ceases, but only if that coverage is terminated under this subdivision uniformly without regard to a health status-related factor of covered individuals. (g) For the purposes of this section, “health benefit plan” has the same meaning as in subdivision (a) of Section 10198.6 and Section 10198.61. (Amended by Stats. 2021, Ch. 627, Sec. 15. (AB 1511) Effective January 1, 2022.)
  181. 10273.7.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    A covered person may ask the commissioner to review a cancellation, rescission, or nonrenewal complaint, and the insurer may have to continue coverage, reinstate coverage, and reimburse covered expenses.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10273.7. (a) A policyholder, certificate holder, or other insured who alleges that a policy or coverage has been or will be canceled, rescinded, or not renewed in violation of Section 10713, 10273.4, 10273.6, 10384.17, or 10384, or any regulations promulgated thereunder, may request a review by the commissioner. (b) If the commissioner determines that a proper complaint exists, the commissioner shall notify the insurer and the policyholder, certificate holder, or other insured. The insurer shall either request a hearing or reinstate the policyholder, certificate holder, or other insured. (c) If, after review, the commissioner determines that the cancellation, rescission, or failure to renew is contrary to existing law, the commissioner shall order the insurer to reinstate the policyholder, certificate holder, or other insured. Within 15 days after receipt of that order, the insurer shall either request a hearing or reinstate the policyholder, certificate holder, or other insured. (d) If a policyholder, certificate holder, or other insured requests a review of the insurer’s determination to cancel, rescind, or failure to renew the policyholder’s, certificate holder’s, or other insured’s policy or coverage pursuant to subdivision (a), the insurer shall continue to provide coverage to the policyholder, certificate holder, or other insured under the terms of the contract or policy until a final determination of the policyholder, certificate holder, or other insured’s request for review has been made by the commissioner. This subdivision shall not apply if the insurer cancels the policy or coverage for nonpayment of premiums pursuant to Section 10713, 10273.4, 10273.6, 10384.17, or 10384, or any regulations promulgated thereunder. (e) A reinstatement pursuant to this section shall be retroactive to the time of cancellation, rescission, or failure to renew and the insurer shall be liable for the expenses incurred by the policyholder, certificate holder, or other insured for covered health care services from the date of cancellation, rescission, or nonrenewal to and including the date of reinstatement. The insurer shall reimburse the policyholder, certificate holder, or insured for any expenses incurred pursuant to this subdivision within 30 days of receipt of the completed claim. (f) This section shall not abrogate any preexisting contracts or policies entered into prior to January 1, 2011, between a policyholder, certificate holder, or other insured and an insurer, except that each insurer shall, if directed to do so by the commissioner, exercise its authority, if any, under any such preexisting contracts or policies to conform them to the provisions of existing law. (g) On or before July 1, 2011, the commissioner may issue guidance regarding compliance with this section and Sections 10713, 10273.4, 10273.6, 10384.17, and 10384, or any regulations promulgated under those provisions. The guidance shall not be subject to the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code). The guidance shall only be effective through December 31, 2013, or until the commissioner adopts and effects regulations pursuant to the Administrative Procedure Act, whichever occurs first. (h) To the extent required by Section 2719 of the federal Public Health Service Act (42 U.S.C. Sec. 300gg-19) and any subsequent rules or regulations, there shall be an independent external review pursuant to the standards required by the United States Secretary of Health and Human Services of an insurer’s cancellation, rescission, or nonrenewal of a policyholder’s, certificate holder’s, or other insured’s coverage. (Added by Stats. 2010, Ch. 658, Sec. 13. (AB 2470) Effective January 1, 2011.)
  182. 10274.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section defines “endorsement” for this chapter as a rider on a separate piece of paper that changes the printed text of a policy.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10274. The term “endorsement” as used in this chapter means any amendment, change, limitation, alteration or restriction of the printed text of a policy by a rider upon a separate piece of paper made a part of such policy. (Added by Stats. 1951, Ch. 570.)
  183. 10275.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section defines “policy of accident and sickness insurance” to include policies or contracts covering the insurance kinds described in Section 106.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10275. The term “policy of accident and sickness insurance” as used in this chapter includes any policy or contract covering the kind or kinds of insurance described in Section 106. (Added by Stats. 1951, Ch. 570.)
  184. 10276.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    Certain individual accident and health policies must include a notice letting the purchaser return the policy and get a premium refund, with a stated return period of 10 to 30 days.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10276. Every individual accident and health policy or contract, except single premium nonrenewable policies or contracts, issued for delivery in this state on or after July 1, 1962, by an insurance company, nonprofit hospital service plan or medical service corporation, shall have printed thereon or attached thereto a notice stating that the person to whom the policy or contract is issued shall be permitted to return the policy or contract after its delivery to the purchaser and to have the premium paid refunded if, after examination of the policy or contract, the purchaser is not satisfied with it for any reason. The period time set forth by the insurer, nonprofit hospital service plan or medical service corporation for return of the policy or contract shall be clearly stated on the notice and such period shall not be less than 10 days nor more than 30 days. The policyholder or purchaser may return the policy or contract to the insurer, plan or corporation at any time during the period specified in the notice. If a policyholder or purchaser pursuant to such notice, returns the policy or contract to the company or association at its home or branch office or to the agent through whom it was purchased, it shall be void from the beginning and the parties shall be in the same position as if no policy or contract had been issued. This section shall apply to all policies or contracts subject to this section and issued, amended, delivered, or renewed in this state on or after January 1, 1981. All policies or contracts subject to this section which are in effect on January 1, 1981, shall be construed to be in compliance with this section, and any provision in any such policy or contract which is in conflict with this section shall be of no force or effect. (Amended by Stats. 1980, Ch. 320, Sec. 2.)
  185. 10277.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section requires insurers to keep dependent child coverage going in specified circumstances, including after the limiting age if the child meets disability and dependency criteria, and it sets notice, proof, and timing rules.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10277. (a) A group health insurance policy that provides that coverage of a dependent child of an employee or other member of the covered group shall terminate upon attainment of the limiting age for dependent children specified in the policy, shall also provide that attainment of the limiting age shall not operate to terminate the coverage of the child while the child is and continues to meet both of the following criteria: (1) Incapable of self-sustaining employment by reason of a physically or mentally disabling injury, illness, or condition. (2) Chiefly dependent upon the employee or member for support and maintenance. (b) The insurer shall notify the employee or member that the dependent child’s coverage will terminate upon attainment of the limiting age unless the employee or member submits proof of the criteria described in paragraphs (1) and (2) of subdivision (a) to the insurer within 60 days of the date of receipt of the notification. The insurer shall send this notification to the employee or member at least 90 days prior to the date the child attains the limiting age. Upon receipt of a request by the employee or member for continued coverage of the child and proof of the criteria described in paragraphs (1) and (2) of subdivision (a), the insurer shall determine whether the dependent child meets that criteria before the child attains the limiting age. If the insurer fails to make the determination by that date, it shall continue coverage of the child pending its determination. (c) The insurer may subsequently request information about a dependent child whose coverage is continued beyond the limiting age under subdivision (a), but not more frequently than annually after the two-year period following the child’s attainment of the limiting age. (d) If the employee or member changes carriers to another insurer or to a health care service plan, the new insurer or plan shall continue to provide coverage for the dependent child. The new plan or insurer may request information about the dependent child initially and not more frequently than annually thereafter to determine if the child continues to satisfy the criteria in paragraphs (1) and (2) of subdivision (a). The employee or member shall submit the information requested by the new plan or insurer within 60 days of receiving the request. (e) If a group health insurance policy provides coverage for a dependent child who is over 26 years of age and enrolled as a full-time student at a secondary or postsecondary educational institution, the following shall apply: (1) Any break in the school calendar shall not disqualify the dependent child from coverage. (2) If the dependent child takes a medical leave of absence, and the nature of the dependent child’s injury, illness, or condition would render the dependent child incapable of self-sustaining employment, the provisions of subdivision (a) shall apply if the dependent child is chiefly dependent on the policyholder for support and maintenance. (3) (A) If the dependent child takes a medical leave of absence from school, but the nature of the dependent child’s injury, illness, or condition does not meet the requirements of paragraph (2), the dependent child’s coverage shall not terminate for a period not to exceed 12 months or until the date on which the coverage is scheduled to terminate pursuant to the terms and conditions of the policy, whichever comes first. The period of coverage under this paragraph shall commence on the first day of the medical leave of absence from the school or on the date the physician determines the illness prevented the dependent child from attending school, whichever comes first. Any break in the school calendar shall not disqualify the dependent child from coverage under this paragraph. (B) Documentation or certification of the medical necessity for a leave of absence from school shall be submitted to the insurer at least 30 days prior to the medical leave of absence from the school, if the medical reason for the absence and the absence are foreseeable, or 30 days after the start date of the medical leave of absence from school and shall be considered prima facie evidence of entitlement to coverage under this paragraph. (4) This subdivision shall not apply to a policy of specialized health insurance, Medicare supplement insurance, CHAMPUS-supplement or TRICARE-supplement insurance policies, or to hospital-only, accident-only, or specified disease insurance policies that reimburse for hospital, medical, or surgical benefits. (f) (1) Except as set forth in paragraph (2), under no circumstances shall the limiting age under a group or individual health insurance policy that provides coverage of a dependent child be less than 26 years of age with respect to policy years beginning on or after September 23, 2010. (2) For policy years beginning before January 1, 2014, a group health insurance policy that qualifies as a grandfathered health plan under Section 1251 of the federal Patient Protection and Affordable Care Act (Public Law 111-148) and that makes available dependent coverage of children may exclude from coverage an adult child who has not attained the age of 26 years only if the adult child is eligible to enroll in an eligible employer-sponsored health plan, as defined in Section 5000A(f)(2) of the Internal Revenue Code, other than a group health plan or policy of a parent. (3) (A) With respect to a child (i) whose coverage under a group or individual health insurance policy ended, or who was denied or not eligible for coverage under a group or individual health insurance policy, because under the terms of the policy the availability of dependent coverage of children ended before the attainment of 26 years of age, and (ii) who becomes eligible for that coverage by reason of the application of this subdivision, the health insurer shall give the child an opportunity to enroll that shall continue for at least 30 days. This opportunity and the notice described in subparagraph (B) shall be provided not later than the first day of the first policy year beginning on or after September 23, 2010, consistent with the federal Patient Protection and Affordable Care Act (Public Law 111-148), as amended by the federal Health Care and Education Reconciliation Act of 2010 (Public Law 111-152), and any additional federal guidance or regulations issued by the United States Secretary of Health and Human Services. (B) The health insurer shall provide written notice stating that a dependent described in subparagraph (A) who has not attained the age of 26 years is eligible to apply for coverage. This notice may be provided to the dependent’s parent on behalf of the dependent. If the notice is included with enrollment materials for a group policy, the notice shall be prominent. (C) In the case of an individual who enrolls under this paragraph, coverage shall take effect no later than the first day of the first policy year beginning on or after September 23, 2010. (D) A dependent enrolling in coverage under a group policy pursuant to this paragraph shall be treated as a special enrollee as provided under the rules of Section 146.117(d) of Title 45 of the Code of Federal Regulations. The health insurer shall offer the recipient of the notice all of the benefit packages available to similarly situated individuals who did not lose coverage by reason of cessation of dependent status. Any difference in benefit or cost-sharing requirements shall constitute a different benefit package. A dependent enrolling in coverage under a group policy pursuant to this paragraph shall not be required to pay more for coverage than similarly situated individuals who did not lose coverage by reason of cessation of dependent status. (4) Nothing in this section shall require a health insurer to make coverage available for a child of a child receiving dependent coverage. Nothing in this section shall be construed to modify the definition of “dependent” as used in the Revenue and Taxation Code with respect to the tax treatment of the cost of coverage. (Amended by Stats. 2010, Ch. 660, Sec. 2. (SB 1088) Effective January 1, 2011.)
  186. 10278.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    This section requires insurers to keep dependent child coverage going past the limiting age if the child meets disability and dependency criteria, and it sets notice, proof, and timing rules.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10278. (a) An individual health insurance policy that provides that coverage of a dependent child shall terminate upon attainment of the limiting age for dependent children specified in the policy, shall also provide that attainment of the limiting age shall not operate to terminate the coverage of the child while the child is and continues to meet both of the following criteria: (1) Incapable of self-sustaining employment by reason of a physically or mentally disabling injury, illness, or condition. (2) Chiefly dependent upon the policyholder or subscriber for support and maintenance. (b) The insurer shall notify the policyholder or subscriber that the dependent child’s coverage will terminate upon attainment of the limiting age unless the policyholder or subscriber submits proof of the criteria described in paragraphs (1) and (2) of subdivision (a) to the insurer within 60 days of the date of receipt of the notification. The insurer shall send this notification to the policyholder or subscriber at least 90 days prior to the date the child attains the limiting age. Upon receipt of a request by the policyholder or subscriber for continued coverage of the child and proof of the criteria described in paragraphs (1) and (2) of subdivision (a), the insurer shall determine whether the dependent child meets that criteria before the child attains the limiting age. If the insurer fails to make the determination by that date, it shall continue coverage of the child pending its determination. (c) The insurer may subsequently request information about a dependent child whose coverage is continued beyond the limiting age under subdivision (a), but not more frequently than annually after the two-year period following the child’s attainment of the limiting age. (d) If the subscriber or policyholder changes carriers to another insurer or to a health care service plan, the new insurer or plan shall continue to provide coverage for the dependent child. The new plan or insurer may request information about the dependent child initially and not more frequently than annually thereafter to determine if the child continues to satisfy the criteria in paragraphs (1) and (2) of subdivision (a). The subscriber or policyholder shall submit the information requested by the new plan or insurer within 60 days of receiving the request. (e) If an individual health insurance policy provides coverage for a dependent child who is over 18 years of age and enrolled as a full-time student at a secondary or postsecondary educational institution, the following shall apply: (1) Any break in the school calendar shall not disqualify the dependent child from coverage. (2) If the dependent child takes a medical leave of absence, and the nature of the dependent child’s injury, illness, or condition would render the dependent child incapable of self-sustaining employment, the provisions of subdivision (a) shall apply if the dependent child is chiefly dependent on the policyholder for support and maintenance. (3) (A) If the dependent child takes a medical leave of absence from school, but the nature of the dependent child’s injury, illness, or condition does not meet the requirements of paragraph (2), the dependent child’s coverage shall not terminate for a period not to exceed 12 months or until the date on which the coverage is scheduled to terminate pursuant to the terms and conditions of the policy, whichever comes first. The period of coverage under this paragraph shall commence on the first day of the medical leave of absence from the school or on the date the physician determines the illness prevented the dependent child from attending school, whichever comes first. Any break in the school calendar shall not disqualify the dependent child from coverage under this paragraph. (B) Documentation or certification of the medical necessity for a leave of absence from school shall be submitted to the insurer at least 30 days prior to the medical leave of absence from the school, if the medical reason for the absence and the absence are foreseeable, or 30 days after the start date of the medical leave of absence from school and shall be considered prima facie evidence of entitlement to coverage under this paragraph. (4) This subdivision shall not apply to a policy of specialized health insurance, Medicare supplement insurance, CHAMPUS-supplement, or TRICARE-supplement insurance policies, or to hospital-only, accident-only, or specified disease insurance policies that reimburse for hospital, medical, or surgical benefits. (Amended by Stats. 2008, Ch. 390, Sec. 3. Effective January 1, 2009.)
  187. 10278.1.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    Certain individual health insurance policies must offer dependent coverage to eligible parent or stepparent dependents, and insurers, the Exchange, and agents must give HICAP notice when a dependent parent or stepparent with Medicare is being added.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10278.1. (a) An individual health insurance policy issued, amended, or renewed on or after January 1, 2023, that provides dependent coverage shall make dependent coverage available to a parent or stepparent who meets the definition of a qualifying relative under Section 152(d) of Title 26 of the United States Code and who lives or resides within the health insurer’s service area. (b) It is the intent of the Legislature to ensure that individuals who are seeking to add to their policy a dependent parent or stepparent who is eligible for or enrolled in Medicare are informed of and understand their specific rights and health care options before enrolling them in an individual health insurance policy, including the potential benefits, financial assistance, and tax liability under those options. (c) If an applicant is seeking to add to their policy a dependent parent or stepparent who is eligible for or enrolled in Medicare: (1) A health insurer shall provide, at the time of solicitation and on the application, to an applicant who does not apply through the California Health Benefit Exchange written notice that the Health Insurance Counseling and Advocacy Program (HICAP) provides health insurance counseling to senior California residents free of charge, including the name, address, and telephone number of the local HICAP program and the statewide HICAP telephone number, 1-800-434-0222. (2) The California Health Benefit Exchange shall provide to an applicant who applies through the California Health Benefit Exchange written notice that HICAP provides health insurance counseling to senior California residents free of charge, including the name, address, and telephone number of the local HICAP program and the statewide HICAP telephone number, 1-800-434-0222. (3) An agent shall provide the name, address, and telephone number of the local HICAP program and the statewide HICAP telephone number, 1-800-434-0222, at the time of solicitation. (d) This section does not apply to specialized health insurance, Medicare supplement insurance, CHAMPUS supplement insurance, or TRICARE supplement insurance, or to hospital-only, accident-only, or specified disease insurance policies that reimburse for hospital, medical, or surgical benefits. (Amended by Stats. 2022, Ch. 118, Sec. 2. (AB 2127) Effective January 1, 2023.)
  188. 10279.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. )

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    Disability insurers that offer telephone medical advice services must make sure those services meet specified licensing, supervision, recordkeeping, filing, and professional-practice requirements.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 1. Scope of Chapter and Definitions [10270 - 10279] ( Article 1 enacted by Stats. 1935, Ch. 145. ) ## 10279. (a) Every disability insurer that provides group or individual policies of disability, or both, that provides, operates, or contracts for, telephone medical advice services to its insureds shall do all of the following: (1) Ensure that the in-state or out-of-state telephone medical advice service complies with the requirements of Chapter 15 (commencing with Section 4999) of Division 2 of the Business and Professions Code. (2) Ensure that the staff providing telephone medical advice services for the in-state or out-of-state telephone medical advice service hold a valid California license as a registered nurse or a valid license in the state within which they provide telephone medical advice services as a physician and surgeon or physician assistant and are operating consistent with the laws governing their respective scopes of practice. (3) Ensure that a physician and surgeon is available on an on-call basis at all times the service is advertised to be available to enrollees and subscribers. (4) Ensure that the in-state or out-of-state telephone medical advice service designates an agent for service of process in California and files this designation with the commissioner. (5) Require that the in-state or out-of-state telephone medical advice service makes and maintains records for a period of five years after the telephone medical advice services are provided, including, but not limited to, oral or written transcripts of all medical advice conversations with the disability insurer’s insureds in California and copies of all complaints. If the records of telephone medical advice services are kept out of state, the insurer shall, upon the request of the director, provide the records to the director within 10 days of the request. (6) Ensure that the telephone medical advice services are provided consistent with good professional practice. (b) The commissioner shall forward to the Department of Consumer Affairs, within 30 days of the end of each calendar quarter, data regarding complaints filed with the department concerning telephone medical advice services. (Amended by Stats. 2016, Ch. 799, Sec. 43. (SB 1039) Effective January 1, 2017.)
  189. 1028.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. )

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    In a liquidation proceeding, a default or collusive judgment against an insured is not evidence of the insured’s liability or the amount of damages owed to the claimant.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. ) ## 1028. A judgment taken by default, or by collusion, against an insured shall not be considered as evidence, in the liquidation proceeding, either of the liability of such insured to such claimant upon such cause of action or of the amount of damages to which such claimant is entitled. (Amended by Stats. 1935, Ch. 291.)
  190. 1029.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. )

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    A secured claimant’s claim cannot be allowed above the unsecured-claim amount minus the security’s value, unless the claimant surrenders the security to the liquidator.

    ## Insurance Code - INS ## DIVISION 1. GENERAL RULES GOVERNING INSURANCE [100 - 1879.8] ( Division 1 enacted by Stats. 1935, Ch. 145. ) ## PART 2. THE BUSINESS OF INSURANCE [680 - 1879.8] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 1. General Regulations [680 - 1113] ( Chapter 1 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 14. Proceedings in Cases of Insolvency and Delinquency [1010 - 1062] ( Article 14 amended by Stats. 1935, Ch. 291. ) ## 1029. A claim of a secured claimant shall not be allowed in a sum greater than the excess over the value of the security of the amount for which the claim would be allowable if unsecured, unless the claimant surrenders the security to the liquidator. Upon such surrender the claim may be allowed in the full amount for which it is valued. (Amended by Stats. 1935, Ch. 291.)
  191. 10290.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2. Approval of Commissioner [10290 - 10293] ( Article 2 enacted by Stats. 1935, Ch. 145. )

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    A disability policy may not be issued or delivered in this state until the required filing is made and either 120 calendar days pass without commissioner notice or the commissioner gives written approval.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2. Approval of Commissioner [10290 - 10293] ( Article 2 enacted by Stats. 1935, Ch. 145. ) ## 10290. A disability policy shall not be issued or delivered to any person in this state until both of the following conditions are met: (a) A copy of the form thereof and, if more than one class of risks is written, of the classification of risks, and the premium rates pertaining thereto are filed with the commissioner. (b) Either of the following occurs: (1) One hundred twenty calendar days expire without notice from the commissioner after the copy is filed. (2) The commissioner gives his or her written approval prior to that time. (Amended by Stats. 2015, Ch. 691, Sec. 3. (AB 387) Effective January 1, 2016.)
  192. 10291.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2. Approval of Commissioner [10290 - 10293] ( Article 2 enacted by Stats. 1935, Ch. 145. )

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    After written notice from the commissioner that a filed form does not comply with law, an insurer must not issue any policy in that form.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2. Approval of Commissioner [10290 - 10293] ( Article 2 enacted by Stats. 1935, Ch. 145. ) ## 10291. If the commissioner notifies the insurer, in writing, that the filed form does not comply with the requirements of law, specifying the reasons for his opinion, it is unlawful thereafter for any such insurer to issue any policy in such form. (Enacted by Stats. 1935, Ch. 145.)
  193. 10291.5.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2. Approval of Commissioner [10290 - 10293] ( Article 2 enacted by Stats. 1935, Ch. 145. )

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    The commissioner may not approve disability policies that fail specified standards, and may withdraw approval of filings in qualifying cases.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2. Approval of Commissioner [10290 - 10293] ( Article 2 enacted by Stats. 1935, Ch. 145. ) ## 10291.5. (a) The purpose of this section is to achieve both of the following: (1) Prevent, in respect to disability insurance, fraud, unfair trade practices, and insurance economically unsound to the insured. (2) Assure that the language of all insurance policies can be readily understood and interpreted. (b) The commissioner shall not approve a disability policy for issuance or delivery in this state in any of the following circumstances: (1) If the commissioner finds that it contains a provision, or has a label, description of its contents, title, heading, backing, or other indication of its provisions that is unintelligible, uncertain, ambiguous, or abstruse, or likely to mislead a person to whom the policy is offered, delivered or issued. (2) If it contains a provision for payment at a rate, or in an amount (other than the product of rate times the periods for which payments are promised) for loss caused by particular event or events (as distinguished from character of physical injury or illness of the insured) more than triple the lowest rate, or amount, promised in the policy for the same loss caused by another event or events (loss caused by sickness, loss caused by accident, and different degrees of disability each being considered, for the purpose of this paragraph, a different loss); or if it contains a provision for payment for a confining loss of time at a rate more than six times the least rate payable for a partial loss of time or more than twice the least rate payable for a nonconfining total loss of time; or if it contains a provision for payment for any nonconfining total loss of time at a rate more than three times the least rate payable for any partial loss of time. (3) If it contains a provision for payment for disability caused by particular event or events (as distinguished from character of physical injury or illness of the insured) payable for a term more than twice the least term of payment provided by the policy for the same degree of disability caused by another event or events; or if it contains a benefit for total nonconfining disability payable for lifetime or for more than 12 months and a benefit for partial disability, unless the benefit for partial disability is payable for at least three months; or if it contains a benefit for total confining disability payable for lifetime or for more than 12 months, unless it also contains benefit for total nonconfining disability caused by the same event or events payable for at least three months, and, if it also contains a benefit for partial disability, unless the benefit for partial disability is payable for at least three months. This paragraph shall apply separately to accident benefits and to sickness benefits. (4) If it contains a provision or provisions that would have the effect, upon termination of the policy, of reducing or ending the liability as the insurer would have, but for the termination, for loss of time resulting from accident occurring while the policy is in force or for loss of time commencing while the policy is in force and resulting from sickness contracted while the policy is in force or for other losses resulting from accident occurring or sickness contracted while the policy is in force, and also contains provision or provisions reserving to the insurer the right to cancel or refuse to renew the policy, unless it also contains other provision or provisions the effect of which is that termination of the policy as the result of the exercise by the insurer of that right shall not reduce or end the liability in respect to the hereinafter specified losses as the insurer would have had under the policy, including its other limitations, conditions, reductions, and restrictions, had the policy not been terminated. The specified losses referred to in the preceding paragraph are: (i) Loss of time that begins while the policy is in force and results from sickness contracted while the policy is in force. (ii) Loss of time that begins within 20 days following and results from accident occurring while the policy is in force. (iii) Losses that result from accident occurring or sickness contracted while the policy is in force and arise out of the care or treatment of illness or injury and which occur within 90 days from the termination of the policy or during a period of continuous compensable loss or losses which period commences before the end of those 90 days. (iv) Losses other than those specified in clause (i), (ii), or (iii) that result from accident occurring or sickness contracted while the policy is in force and which losses occur within 90 days following the accident or the contraction of the sickness. (5) If a caption, label, title, or description of contents the policy states, implies, or infers without reasonable qualification that it provides loss of time indemnity for lifetime, or for a period of more than two years, if the loss of time indemnity is made payable only when house confined or only under special contingencies not applicable to other total loss of time indemnity. (6) If it contains a benefit for total confining disability payable only upon condition that the confinement be of an abnormally restricted nature unless the caption of the part containing that benefit is accurately descriptive of the nature of the confinement required and unless, if the policy has a description of contents, label, or title, at least one of them contain reference to the nature of the confinement required. (7) (A) If, irrespective of the premium charged therefor, a benefit of the policy is, or the benefits of the policy as a whole are, not sufficient to be of real economic value to the insured. (B) In determining whether benefits are of real economic value to the insured, the commissioner shall not differentiate between insureds of the same or similar economic or occupational classes and shall give due consideration to all of the following: (i) The right of insurers to exercise sound underwriting judgment in the selection and amounts of risks. (ii) Amount of benefit, length of time of benefit, nature or extent of benefit, or any combination of those factors. (iii) The relative value in purchasing power of the benefit or benefits. (iv) Differences in insurance issued on an industrial or other special basis. (C) To be of real economic value, it shall not be necessary that any benefit or benefits cover the full amount of a loss which might be suffered by reason of the occurrence of a hazard or event insured against. (8) If it substitutes a specified indemnity upon the occurrence of accidental death for a benefit of the policy, other than a specified indemnity for dismemberment, that would accrue before that death or if it contains a provision that has the effect, other than at the election of the insured exercisable within not less than 20 days in the case of benefits specifically limited to the loss by removal of one or more fingers or one or more toes or within not less than 90 days in all other cases, of doing any of the following: (A) Of substituting, upon the occurrence of the loss of both hands, both feet, one hand and one foot, the sight of both eyes or the sight of one eye and the loss of one hand or one foot, some specified indemnity for any or all benefits under the policy unless the indemnity so specified is equal to or greater than the total of the benefit or benefits for which that specified indemnity is substituted and which, assuming in all cases that the insured would continue to live, could possibly accrue within four years from the date of that dismemberment under all other provisions of the policy applicable to the particular event or events (as distinguished from character of physical injury or illness) causing the dismemberment. (B) Of substituting, upon the occurrence of any other dismemberment some specified indemnity for any or all benefits under the policy unless the indemnity so specified is equal to or greater than one-fourth of the total of the benefit or benefits for which the specified indemnity is substituted and which, assuming in all cases that the insured would continue to live, could possibly accrue within four years from the date of the dismemberment under all other provisions of the policy applicable to the particular event or events (as distinguished from character of physical injury or illness) causing the dismemberment. (C) Of substituting a specified indemnity upon the occurrence of a dismemberment for a benefit of the policy which would accrue before the time of dismemberment. As used in this section, loss of a hand shall be severance at or above the wrist joint, loss of a foot shall be severance at or above the ankle joint, loss of an eye shall be the irrecoverable loss of the entire sight thereof, loss of a finger shall mean at least one entire phalanx thereof and loss of a toe the entire toe. (9) If it contains a provision, other than as provided in Section 10369.3, reducing an original benefit more than 50 percent on account of age of the insured. (10) If the insuring clause or clauses contain no reference to the exceptions, limitations, and reductions (if any) or no specific reference to, or brief statement of, each abnormally restrictive exception, limitation, or reduction. (11) If it contains benefit or benefits for loss or losses from specified diseases only unless: (A) All of the diseases so specified in each provision granting the benefits fall within some general classification based upon the following: (i) The part or system of the human body principally subject to all those diseases. (ii) The similarity in nature or cause of those diseases. (iii) In case of diseases of an unusually serious nature and protracted course of treatment, the common characteristics of all those diseases with respect to severity of affliction and cost of treatment. (B) The policy is entitled and each provision granting the benefits is separately captioned in clearly understandable words so as to accurately describe the classification of diseases covered and expressly point out, when that is the case, that not all diseases of the classification are covered. (12) If it does not contain provision for a grace period of at least the number of days specified below for the payment of each premium falling due after the first premium, during which grace period the policy shall continue in force provided, that the grace period to be included in the policy shall be not less than seven days for policies providing for weekly payment of premium, not less than 10 days for policies providing for monthly payment of premium and not less than 31 days for all other policies. (13) If it fails to conform with a law of this state. (c) The commissioner shall not approve a disability policy covering hospital, medical, or surgical expenses unless the commissioner finds that the application conforms to both of the following requirements: (1) All applications for disability insurance covering hospital, medical, or surgical expenses, except that which is guaranteed issue, which include questions relating to medical conditions, shall contain clear and unambiguous questions designed to ascertain the health condition or history of the applicant. (2) The application questions designed to ascertain the health condition or history of the applicant shall be based on medical information that is reasonable and necessary for medical underwriting purposes. The application shall include a prominently displayed notice that states: “California law prohibits an HIV test from being required or used by health insurance companies as a condition of obtaining health insurance coverage.” (d) This section does not authorize the commissioner to establish or require a single or standard application form for application questions. (e) The commissioner may, from time to time as conditions warrant, after notice and hearing, promulgate reasonable rules and regulations, and amendments and additions thereto, as are necessary or convenient, to establish, in advance of the submission of policies, the standard or standards conforming to subdivision (b), by which the commissioner shall disapprove or withdraw approval of a disability policy. (1) In promulgating a rule or regulation the commissioner shall give consideration to the criteria established in this section and to the desirability of approving for use in policies in this state uniform provisions, nationwide or otherwise, and is hereby granted the authority to consult with insurance authorities of any other state and their representatives individually or by way of convention or committee, to seek agreement upon those provisions. (2) A rule or regulation shall be promulgated in accordance with the procedure provided in Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. (f) (1) The commissioner may withdraw approval of filing of any policy or other document or matter required to be approved by the commissioner, or filed with the commissioner, by this chapter when the commissioner would be authorized to disapprove or refuse filing of the same if originally submitted at the time of the action of withdrawal. (2) A withdrawal pursuant to paragraph (1) shall be in writing and shall specify reasons. An insurer adversely affected by a withdrawal may, within a period of 30 days following mailing or delivery of the writing containing the withdrawal, by written request secure a hearing to determine whether the withdrawal should be annulled, modified, or confirmed. Unless, at any time, it is mutually agreed to the contrary, a hearing shall be granted and commenced within 30 days following filing of the request and shall proceed with reasonable dispatch to determination. Unless the commissioner in writing in the withdrawal, or subsequent thereto, grants an extension, a withdrawal shall, in the absence of a hearing request, be effective, prospectively and not retroactively, on the 91st day following the mailing or delivery of the withdrawal, and, if request for the hearing is filed, on the 91st day following mailing or delivery of written notice of the commissioner’s determination. (g) A proceeding under this section is not subject to Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code. (h) (1) Except as provided in subdivision (k), an action taken by the commissioner under this section is subject to review by the courts of this state and proceedings on review shall be in accordance with the Code of Civil Procedure. (2) Notwithstanding any other law, a petition for review may be filed at any time before the effective date of the action taken by the commissioner. No action of the commissioner shall become effective before the expiration of 20 days after written notice and a copy thereof are mailed or delivered to the person adversely affected, and an action so submitted for review shall not become effective for a further period of 15 days after the filing of the petition in court. The court may stay the effectiveness thereof for a longer period. (i) This section shall be liberally construed to effectuate the purpose and intentions of this section, but shall not be construed to grant the commissioner power to fix or regulate rates for disability insurance or prescribe a standard form of disability policy, except that the commissioner shall prescribe a standard supplementary disclosure form for presentation with all disability insurance policies, pursuant to Section 10603. (j) This section shall be effective on and after July 1, 1950, as to all policies thereafter submitted and on and after January 1, 1951, the commissioner may withdraw approval pursuant to subdivision (d) of a policy thereafter issued or delivered in this state irrespective of when its form may have been submitted or approved, and before those dates the law in effect on January 1, 1949, shall apply to those policies. (k) A policy issued by an insurer to an insured on a form approved by the commissioner before July 1, 1950, and in accordance with the conditions, if any, contained in the approval, at a time when that approval is outstanding shall, as between the insurer and the insured, or a person claiming under the policy, be conclusively presumed to comply with, and conform to, this section. (Amended by Stats. 2020, Ch. 184, Sec. 45. (SB 1255) Effective January 1, 2021.)
  194. 10291.6.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2. Approval of Commissioner [10290 - 10293] ( Article 2 enacted by Stats. 1935, Ch. 145. )

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    A noncancellable disability policy may be approved if age-based benefit reductions stay within the stated limits.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2. Approval of Commissioner [10290 - 10293] ( Article 2 enacted by Stats. 1935, Ch. 145. ) ## 10291.6. Insofar as the reduction of any original benefit on account of age of the insured is concerned, a noncancellable policy may be approved if such reduction does not exceed that permitted by Section 10291.5(b)(9), or if the only such reduction is one having the effect of reducing the limit of the period for which benefits for loss of time resulting from total disability will be paid to a period ending on the date on which the insured’s right to continue the policy in force expires and if the policy also provides that such limit shall not in any case be less than 12 months. (Added by Stats. 1953, Ch. 435.)
  195. 10292.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2. Approval of Commissioner [10290 - 10293] ( Article 2 enacted by Stats. 1935, Ch. 145. )

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    A supplemental benefit cannot be delivered or issued in this state until its form is submitted to and approved by the commissioner.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2. Approval of Commissioner [10290 - 10293] ( Article 2 enacted by Stats. 1935, Ch. 145. ) ## 10292. (a) A supplemental benefit described in subdivision (a) of Section 10271 shall not be delivered or issued for delivery to any person in this state until a copy of the form thereof is submitted to, and approved by, the commissioner. If the supplemental benefit is an integral part of a contract of life insurance or annuity, the entire contract shall be submitted to the commissioner, but his or her power of approval or disapproval, unless it is otherwise authorized, is limited to the supplemental portion and any other portions that relate to the supplemental portion. (b) A supplemental benefit described in subdivision (a) of Section 10271 shall be considered an integral part of a contract for purposes of this section. To facilitate the review of a supplemental benefit, the insurer shall submit, for informational purposes, a sample copy of the life insurance or annuity contract with which the supplemental benefit will be used. To facilitate the location of the required provisions as stated in subdivision (c) of Section 10271, the insurer shall provide the sample copy page reference for the provisions that appear in the contract. (c) The commissioner may adopt reasonable rules and regulations as are necessary to administer and carry out the purposes of Sections 10271 and 10271.1, Article 2.1 (commencing with Section 10295), and this section. (Amended by Stats. 2013, Ch. 345, Sec. 6. (SB 281) Effective January 1, 2014.)
  196. 10293.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2. Approval of Commissioner [10290 - 10293] ( Article 2 enacted by Stats. 1935, Ch. 145. )

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    The commissioner must withdraw approval of certain disability insurance policies if their benefits are unreasonable compared with the premium, and must adopt rules for that standard.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2. Approval of Commissioner [10290 - 10293] ( Article 2 enacted by Stats. 1935, Ch. 145. ) ## 10293. (a) The commissioner shall, after notice and hearing, withdraw approval of an individual or mass-marketed policy of disability insurance if after consideration of all relevant factors the commissioner finds that the benefits provided under the policy are unreasonable in relation to the premium charged. The commissioner shall, from time to time as conditions warrant, after notice and hearing, promulgate such reasonable rules and regulations, and amendments and additions thereto, as are necessary to establish the standard or standards by which the commissioner shall withdraw approval of any such policy. Any such rule or regulation shall be promulgated in accordance with the procedure provided in Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, and shall be effective 90 days after adoption by the commissioner. (b) Unless the commissioner specifies otherwise in writing in the withdrawals, or subsequent thereto, grants an extension, any such withdrawal shall be effective prospectively and not retroactively on the 91st day following the mailing or delivery of the withdrawal. (c) As used in this section: (1) “Mass-marketed policy” means any group or blanket disability insurance policy which is offered by means of direct response solicitation through a sponsoring organization, or through the mails or other mass communications media and under which a person insured pays all or substantially all of the cost of his or her insurance. (2) “Direct response solicitation” means any offer by an insurer to persons in this state, either directly or through a third party, to effect health insurance coverage which enables the individual to apply or enroll for the insurance on the basis of the offer. It shall not include solicitation for insurance through an employer benefit plan which is defined in Public Law 93-406, nor shall it include such a solicitation through the individual’s creditor with respect to credit health insurance. (Amended by Stats. 1985, Ch. 106, Sec. 98.)
  197. 10295.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2.1. Accelerated Death Benefits [10295 - 10295.19] ( Article 2.1 added by Stats. 2013, Ch. 345, Sec. 7. )

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    This section restricts how accelerated death benefits may be offered and sets certification, assessment, and renewal rules for certain chronically ill insureds.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2.1. Accelerated Death Benefits [10295 - 10295.19] ( Article 2.1 added by Stats. 2013, Ch. 345, Sec. 7. ) ## 10295. (a) An accelerated death benefit, as described in this section, shall not be offered, sold, issued, or marketed as health, accident, or long-term care insurance. An accelerated death benefit shall not reimburse or provide specific coverage for any health, accident, or long-term care insurance benefits. (b) (1) For the purposes of this article, an “accelerated death benefit” means a provision, endorsement, or rider added to a life insurance policy that provides for the advance payment of any part of the death proceeds, payable upon the occurrence of a qualifying event in accordance with Section 10295.1. (2) For the purposes of this article, “qualifying event” means that subparagraph (A) or (B) applies. (A) The insured has a medical condition that would, in the absence of treatment, result in death within a limited period of time, as defined by the supplemental benefit, but that shall not be restricted to a period of less than six months. (B) (i) The insured has a chronic illness as defined in subparagraph (B) of paragraph (5) of subdivision (b) of Section 10271.1. (ii) For policies intended to be federally tax qualified, the insurer shall require that a licensed health care practitioner, independent of the insurer, certifies that the insured meets the definition of “chronically ill individual” as defined under the federal Health Insurance Portability and Accountability Act (Public Law 104-191). The accelerated death benefit shall explain subclauses (I) through (IV) and comply with all of the following: (I) An insured has the option of submitting a certification to the insurer or submitting a notice of claim and requesting that the insurer conduct the assessment. If the insured requests that the insurer conduct the assessment, the insurer shall provide an independent licensed health care practitioner to conduct the assessment. If a health care practitioner makes a determination, pursuant to this clause, that an insured does not meet the definition of “chronically ill individual,” the insurer shall notify the insured that the insured shall be entitled to a second assessment by a licensed health care practitioner, upon request, who shall personally examine the insured. The requirement for a second assessment shall not apply if the initial assessment was performed by a practitioner who otherwise meets the requirements of this clause and who personally examined the insured. (II) The assessments conducted pursuant to this clause shall be performed promptly with the certification completed as quickly as possible to ensure that an insured’s benefits are not delayed. The written certification shall be renewed every 12 months. (III) The costs to have a licensed health care practitioner certify that an insured meets, or continues to meet, the definition of “chronically ill individual,” shall not count against the lifetime maximum of the policy or certificate. (IV) In order to be considered “independent of the insurer,” a licensed health care practitioner shall not be an employee of the insurer and shall not be compensated in any manner that is linked to the outcome of the certification. (V) It is the intent of the Legislature in enacting this clause that the practitioner’s assessments be unhindered by financial considerations. (VI) This clause shall apply only to a policy or certificate intended to be federally tax qualified. (3) For the purposes of this article, “applicant” means any of the following: (A) In the case of an individual life insurance policy with an accelerated death benefit, the person who seeks to contract for benefits. (B) (i) In the case of a group life insurance policy with an accelerated death benefit, the proposed certificate holder. (ii) “Certificate” means any certificate issued under a group life insurance policy that includes an accelerated death benefit. (4) For the purposes of this article, “supplemental benefit” means a rider to or provision in a life insurance policy, certificate, or annuity contract that provides a benefit as set forth in subdivision (a) of Section 10271. (c) A life insurance policy that accelerates death benefits if the insured is chronically ill and requires that the insured receives long-term care services described in Section 10231.2, shall not be considered an accelerated death benefit for the purposes of this article. (d) This section does not prohibit an insurer from including other riders to a life insurance policy, such as a terminal illness rider, that are not subject to this article. (Amended by Stats. 2021, Ch. 627, Sec. 16. (AB 1511) Effective January 1, 2022.)
  198. 10295.1.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2.1. Accelerated Death Benefits [10295 - 10295.19] ( Article 2.1 added by Stats. 2013, Ch. 345, Sec. 7. )

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    An accelerated death benefit policy must include specified disclosures and cannot impose certain limits, and the insurer must give related notices.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2.1. Accelerated Death Benefits [10295 - 10295.19] ( Article 2.1 added by Stats. 2013, Ch. 345, Sec. 7. ) ## 10295.1. (a) An accelerated death benefit as defined in paragraph (1) of subdivision (b) of Section 10295 shall comply with, and shall explain all of, the following: (1) That the accelerated death benefit is fixed at the time the insurer approves the request for the accelerated death benefit. (2) That the payment of the accelerated death benefit is not conditioned on the receipt of long-term care or medical services. (3) That the insured shall have the option to take the accelerated death benefit in a lump sum on the occurrence of a qualifying event, as well as an option to receive the benefit in periodic payments for a certain period only. The insured shall have the choice of requesting a lump sum that is equal to the maximum amount of the accelerated death benefit, or requesting a lump sum that is less than the maximum amount. For purposes of this paragraph, “lump sum” shall mean that a claim is paid in a single payment. (4) That the accelerated death benefit may not restrict the insured’s use of the proceeds. (5) That the payment of the accelerated death benefit is due immediately upon receipt of the due written proof of eligibility. (6) That, prior to the payment of the accelerated death benefit, the insurer is required to obtain from an assignee or irrevocable beneficiary, if any, a signed acknowledgment of concurrence for payout. If the insurer making the accelerated death benefit is itself the assignee under the policy, the acknowledgment is not required. (7) That if any death benefit remains after payment of an accelerated death benefit, the accidental death benefit provision, if any, in the policy shall not be affected by the payment of the accelerated death benefit. (b) The accelerated death benefit shall also provide for all of the following: (1) A maximum amount that may be accelerated. (2) An explanation that the insured may accelerate more than once on a qualifying event up to the maximum amount. (3) An explanation that the insured may accelerate on more than one of the qualifying events specified in the supplemental provision up to the maximum amount. (4) A statement that the policy, rider, endorsement, or certificate pays proceeds that are or are not intended for favorable tax treatment under Section 101(g) of the Internal Revenue Code (26 U.S.C. Sec. 101(g)), if applicable. (c) The insurer shall advise the policyholder or certificate holder that there may be tax consequences of accepting an amount above the amount that would be tax qualified under the Internal Revenue Code. (d) The accelerated death benefit shall not contain any preexisting condition limitation and shall not contain any requirement that acceleration be conditioned on a prior hospitalization or institutionalization. (e) The accelerated death benefit shall contain an explanation of how the insured will pay for the accelerated death benefit, whether by paying a portion of the premium for the life insurance policy, by paying a fee at the time of the acceleration, by paying the cost of insurance charge, or by paying the administrative expense charge, together with an illustration. If there is a premium or cost of insurance charge, or a charge imposed upon the acceleration, a generic illustration numerically demonstrating any effect of the payment of a benefit on the policy’s cash value, accumulation account, death benefit, premium, policy loans, and policy liens shall suffice for this purpose. (f) (1) Every accelerated death benefit that pays proceeds intended for favorable tax treatment under Section 101(g) of the Internal Revenue Code (26 U.S.C. Sec. 101(g)) shall be identified as such by prominently displaying and printing that intention on page one of the accelerated benefit policy provision, rider, endorsement, or certificate. (2) Every accelerated death benefit that pays proceeds that are not intended for favorable tax treatment under Section 101(g) of the Internal Revenue Code (26 U.S.C. Sec. 101(g)) shall be identified as such by prominently displaying and printing that intention on page one of the accelerated death benefit policy provision, rider, endorsement, or certificate. (Amended by Stats. 2018, Ch. 98, Sec. 6. (AB 2180) Effective January 1, 2019.)
  199. 10295.10.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2.1. Accelerated Death Benefits [10295 - 10295.19] ( Article 2.1 added by Stats. 2013, Ch. 345, Sec. 7. )

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    An insurer may not cancel, nonrenew, or terminate accelerated death benefits, and may not terminate a policy or increase premiums because of an insured person’s age, health decline, or divorce.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2.1. Accelerated Death Benefits [10295 - 10295.19] ( Article 2.1 added by Stats. 2013, Ch. 345, Sec. 7. ) ## 10295.10. An insurer may not: (a) Cancel, nonrenew, or otherwise terminate an accelerated death benefit on the grounds of the age or the deterioration of the mental or physical health of the insured individual or certificate holder. (b) Terminate a policy, certificate, or rider, or contain a provision that allows the premium for an in-force policy, certificate, or rider, to be increased due to the divorce of a policyholder or certificate holder. (Added by Stats. 2013, Ch. 345, Sec. 7. (SB 281) Effective January 1, 2014.)
  200. 10295.11.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2.1. Accelerated Death Benefits [10295 - 10295.19] ( Article 2.1 added by Stats. 2013, Ch. 345, Sec. 7. )

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    Insurers offering accelerated death benefits must not market them as long-term care, nursing home, or home care insurance, and must include specified disclosures in advertising. Certain term life advertising must say the benefit ends with the policy, and insurers must file proposed advertising with the commissioner before use.

    ## Insurance Code - INS ## DIVISION 2. CLASSES OF INSURANCE [1880 - 12880.8] ( Division 2 enacted by Stats. 1935, Ch. 145. ) ## PART 2. LIFE AND DISABILITY INSURANCE [10110 - 11549] ( Part 2 enacted by Stats. 1935, Ch. 145. ) ## CHAPTER 4. Standard Provisions in Disability Policies [10270 - 10402.1] ( Chapter 4 enacted by Stats. 1935, Ch. 145. ) ## ARTICLE 2.1. Accelerated Death Benefits [10295 - 10295.19] ( Article 2.1 added by Stats. 2013, Ch. 345, Sec. 7. ) ## 10295.11. (a) An accelerated death benefit shall not be advertised or marketed as long-term care insurance, nursing home insurance, or home care insurance. Any advertisement, description, comparison, marketing material, or illustration shall state in bold type: “This is a life insurance benefit that also gives you the option to accelerate some or all of the death benefit in the event that you meet the criteria for a qualifying event described in the policy. This policy or certificate does not provide long-term care insurance subject to California long-term care insurance law. This policy or certificate is not a California Partnership for Long-Term Care program policy. This policy or certificate is not a Medicare supplement (policy or certificate).” An insurer shall also include in any advertisement or marketing materials for these insurance policies all of the following: (1) A statement that the policy or certificate pays proceeds that are or are not intended to receive favorable tax treatment under Section 101(g) of the Internal Revenue Code (26 U.S.C. Sec. 101(g)). (2) A description of the accelerated death benefits provided by the policy, including a description of the acceleration of the death benefit to pay an unrestricted cash benefit when the insured has become chronically ill or otherwise eligible for benefits from a qualified event. (3) A comparison between the benefits provided by life insurance policies, riders, or endorsements that contain accelerated death benefits and the benefits provided by long-term care insurance. (b) Advertising for term life insurance policies or certificates that contain an accelerated death benefit to be attached to an existing term life policy shall include a prominent statement that the accelerated death benefit will terminate with the policy. (c) On or after January 1, 2014, every insurer offering accelerated death benefits shall file with the commissioner copies of all advertising for accelerated death benefits that the insurer proposes to disseminate in the state prior to use of that material. The commissioner shall have the authority to disapprove any advertising that does not meet the requirements of this code. If the commissioner disapproves the advertising, the insurer shall not use and shall stop using the disapproved advertising. Nothing in this subdivision shall be construed as requiring prior approval of advertising prior to dissemination in this state. (Amended by Stats. 2025, Ch. 558, Sec. 21. (AB 487) Effective January 1, 2026.)

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