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A bill to be entitled

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An act relating to long-term care policies; amending s.

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627.94073, F.S.; revising provisions requiring that

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insurers notify policyholders of the right to designate a

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secondary addressee to receive a notice of termination;

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requiring that a canceled  policy be reinstated if the

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policyholder failed to pay the premium due to an extended

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hospital confinement; providing for application; providing

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an effective date.

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Be It Enacted by the Legislature of the State of Florida:

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     Section 1.  Section 627.94073, Florida Statutes, is amended

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to read:

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     627.94073  Notice of cancellation; grace period.--

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     (1)  A long-term care policy shall provide that the insured

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is entitled to a grace period of not less than 30 days, within

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which payment of any premium after the first may be made. The

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insurer may require payment of an interest charge not in excess

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of 8 percent per year for the number of days elapsing before the

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payment of the premium, during which period the policy shall

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continue in force. If the policy becomes a claim during the grace

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period before the overdue premium is paid, the amount of such

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premium or premiums with interest not in excess of 8 percent per

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year may be deducted in any settlement under the policy.

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     (2)  A long-term care policy may not be canceled for

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nonpayment of premium unless, after expiration of the grace

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period in subsection (1), and at least 30 days prior to the

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effective date of such cancellation, the insurer has mailed a

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notification of possible lapse in coverage to the policyholder

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and to a specified secondary addressee if such addressee has been

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designated in writing by name and address by the policyholder.

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For policies issued or renewed on or after October 1, 1996, the

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insurer shall notify the policyholder, at least once annually

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every 2 years, of the right to designate a secondary addressee.

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The applicant has the right to designate at least one person who

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is to receive the notice of termination, in addition to the

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insured. Designation shall not constitute acceptance of any

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liability on the third party for services provided to the

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insured. The form used for the written designation must provide

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space clearly designated for listing at least one person. The

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form must also inform the policyholder to update any change made

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to the address of the secondary addressee. The designation shall

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include each person's full name and home address. In the case of

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an applicant who elects not to designate an additional person,

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the waiver shall state: "Protection against unintended lapse.--I

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understand that I have the right to designate at least one person

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other than myself to receive notice of lapse or termination of

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this long-term care or limited benefit insurance policy for

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nonpayment of premium. I understand that notice will not be given

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until 30 days after a premium is due and unpaid. I elect NOT to

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designate any person to receive such notice." Notice shall be

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given by United States Postal Service proof of mailing or

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certified or registered mail to the policyholder at the address

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shown in the policy. first class United States mail, postage

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prepaid, and Notice may not be given until 30 days after a

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premium is due and unpaid. Notice shall be deemed to have been

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given as of 5 days after the date of mailing.

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     (3)  If a policy is canceled due to nonpayment of premium,

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the policyholder is shall be entitled to have the policy

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reinstated if, within a period of not less than 5 months after

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the date of cancellation, the policyholder or any secondary

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addressee designated pursuant to subsection (2) demonstrates that

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the failure to pay the premium when due was unintentional and due

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to the policyholder's cognitive impairment, or loss of functional

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capacity, or continuous hospital confinement of the policyholder

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for a period in excess of 60 days. Policy reinstatement shall be

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subject to payment of overdue premiums. The standard of proof of

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cognitive impairment or loss of functional capacity shall not be

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more stringent than the benefit eligibility criteria for

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cognitive impairment or the loss of functional capacity, if any,

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contained in the policy and certificate. The insurer may require

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payment of an interest charge not in excess of 8 percent per year

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for the number of days elapsing before the payment of the

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premium, during which period the policy shall continue in force

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if the demonstration of cognitive impairment is made. If the

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policy becomes a claim during the 180-day period before the

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overdue premium is paid, the amount of the premium or premiums

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with interest not in excess of 8 percent per year may be deducted

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in any settlement under the policy.

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     (4)  When the policyholder or certificateholder pays premium

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for a long-term care insurance policy or certificate policy

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through a payroll or pension deduction plan, the requirements in

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subsection (2) need not be met until 60 days after the

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policyholder or certificateholder is no longer on such a payment

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plan. The application or enrollment form for such policies or

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certificates shall clearly indicate the payment plan selected by

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the applicant.

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     Section 2.  This act shall take effect January 1, 2009, and

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applies to policies issued or renewed on or after that date.