HB 1431

1	A bill to be entitled
2	An act relating to long-term care policies; amending s.
3	627.94073, F.S.; revising provisions requiring that
4	insurers notify policyholders of the right to designate a
5	secondary addressee to receive a notice of termination;
6	requiring that a canceled policy be reinstated if the
7	policyholder failed to pay the premium due to an extended
8	hospital confinement; providing construction; providing an
9	effective date.
10
11	Be It Enacted by the Legislature of the State of Florida:
12
13	Section 1.  Subsections (2) and (3) of section 627.94073,
14	Florida Statutes, are amended, and subsection (5) is added to
15	that section, to read:
16	627.94073  Notice of cancellation; grace period.--
17	(2)  A long-term care policy may not be canceled for
18	nonpayment of premium unless, after expiration of the grace
19	period in subsection (1), and at least 30 days prior to the
20	effective date of such cancellation, the insurer has mailed a
21	notification of possible lapse in coverage to the policyholder
22	and to a specified secondary addressee if such addressee has
23	been designated in writing by name and address by the
24	policyholder. For policies issued or renewed on or after October
25	1, 1996, the insurer shall notify the policyholder, at least
26	once annually every 2 years, of the right to designate a
27	secondary addressee. The applicant has the right to designate at
28	least one person who is to receive the notice of termination, in
29	addition to the insured. Designation shall not constitute
30	acceptance of any liability on the third party for services
31	provided to the insured. The form used for the written
32	designation must provide space clearly designated for listing at
33	least one person. The form must also inform the policyholder to
34	update any change made to the address of the secondary
35	addressee. The designation shall include each person's full name
36	and home address. In the case of an applicant who elects not to
37	designate an additional person, the waiver shall state:
38	"Protection against unintended lapse.--I understand that I have
39	the right to designate at least one person other than myself to
40	receive notice of lapse or termination of this long-term care or
41	limited benefit insurance policy for nonpayment of premium. I
42	understand that notice will not be given until 30 days after a
43	premium is due and unpaid. I elect NOT to designate any person
44	to receive such notice." Notice shall be given by United States
45	Postal Service proof of mailing or certified or registered mail
46	to the policyholder and the secondary addressee at the addresses
47	provided to the insurer. first class United States mail, postage
48	prepaid, and Notice may not be given until 30 days after a
49	premium is due and unpaid. Notice shall be deemed to have been
50	given as of 5 days after the date of mailing.
51	(3)  If a policy is canceled due to nonpayment of premium,
52	the policyholder is shall be entitled to have the policy
53	reinstated if, within a period of not less than 5 months after
54	the date of cancellation, the policyholder or any secondary
55	addressee designated pursuant to subsection (2) demonstrates
56	that the failure to pay the premium when due was unintentional
57	and due to the policyholder's cognitive impairment, or loss of
58	functional capacity, or continuous hospital confinement of the
59	policyholder for a period in excess of 60 days. Policy
60	reinstatement shall be subject to payment of overdue premiums.
61	The standard of proof of cognitive impairment or loss of
62	functional capacity shall not be more stringent than the benefit
63	eligibility criteria for cognitive impairment or the loss of
64	functional capacity, if any, contained in the policy and
65	certificate. The insurer may require payment of an interest
66	charge not in excess of 8 percent per year for the number of
67	days elapsing before the payment of the premium, during which
68	period the policy shall continue in force if the demonstration
69	of cognitive impairment is made. If the policy becomes a claim
70	during the 180-day period before the overdue premium is paid,
71	the amount of the premium or premiums with interest not in
72	excess of 8 percent per year may be deducted in any settlement
73	under the policy.
74	(5)  For purposes of this section, the terms
75	"policyholder," "applicant," and "insured" are interchangeable.
76	Section 2.  This act shall take effect July 1, 2008.

CODING: Words stricken are deletions; words underlined are additions.