(a) This section shall not apply to life insurance policies that accelerate benefits for long-term care.
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Terms Used In Hawaii Revised Statutes 431:10H-231

  • Applicant: means :

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

    (2) In the case of a group long-term care insurance policy, the proposed certificate holder. See Hawaii Revised Statutes 431:10H-104

  • 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:

    (1) 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 organizations; or

    (2) Any professional, trade, or occupational association for its members or former or retired members, or combination thereof, if the association:

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

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

    (3) 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. See Hawaii Revised Statutes 431:10H-104

  • Long-term care insurance: means any insurance policy or rider advertised, marketed, offered, or designed to provide coverage for not less than twelve consecutive months for each covered person on an expense incurred, indemnity, prepaid, or other basis, for one or more necessary or medically necessary diagnostic, preventive, therapeutic, rehabilitative, maintenance, or personal care services, provided in a setting other than an acute care unit of a hospital. See Hawaii Revised Statutes 431:10H-104
  • NAIC: means the National Association of Insurance Commissioners. See Hawaii Revised Statutes 431:10H-104
(b) Every insurer, health care service plan, or other entity marketing long-term care insurance (the “issuer”) 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 producers in the use of its suitability standards; and
(3) Maintain a copy of its suitability standards and make them available for inspection upon request by the commissioner.
(c) To determine whether the applicant meets the standards developed by the issuer, the producer and issuer shall develop procedures that take the following into consideration:

(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; and
(3) The values, 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.

The issuer, and where a producer is involved, the producer shall make reasonable efforts to obtain the information set out above. The efforts shall include presentation to the applicant, at or prior to application, the “Long-Term Care Insurance Personal Worksheet”. The personal worksheet used by the issuer shall contain, at a minimum, information in the format contained in Appendix B of the April, 2002, NAIC Long-Term Care Insurance Model Regulation, in not less than twelve-point type. The issuer may request the applicant to provide additional information to comply with its suitability standards. A copy of the issuer’s personal worksheet shall be filed with the commissioner.

(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 sales of employer group long-term care insurance to employees and their spouses.
(e) The sale or dissemination outside the company or agency by the issuer or producer of information obtained through the personal worksheet in Appendix B of the April, 2002, NAIC Long-Term Care Insurance Model Regulation 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 a particular applicant is appropriate. The producers shall use the suitability standards developed by the issuer in marketing long-term care insurance.
(g) At the same time as the personal worksheet is provided to the applicant, the disclosure form entitled “Things You Should Know Before You Buy Long-Term Care Insurance” shall be provided. The form shall be in the format contained in Appendix C to the December, 2006, NAIC Long-Term Care Insurance Model Regulation, in not less than twelve-point type.
(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. In the alternative, the issuer shall send the applicant a letter similar to the April, 2002, NAIC Long-Term Care Insurance Model Regulation, Appendix D. 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 alternate method of verification shall be made part of the applicant’s file.
(i) The issuer 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 a personal worksheet, the number of applicants who did not meet the suitability standards, and the number of those who chose to confirm after receiving a suitability letter.

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