§ 27-18.2-6 - Disclosure standards. - Rhode Island Statutes

SECTION 27-18.2-6

   § 27-18.2-6  Disclosure standards. –(a) In order to provide for full and fair disclosure in the sale of Medicaresupplement policies, no Medicare supplement policy or certificate shall bedelivered in this state unless an outline of coverage is delivered to theapplicant at the time application is made.

   (b) The director shall prescribe the format and content ofthe outline of coverage required by subsection (a) of this section. For thepurposes of this section, "format" means style, arrangements, and overallappearance, including such items as the size, color, and prominence of type andarrangement of text and captions. The outline of coverage shall include:

   (1) A description of the principal benefits and coverageprovided in the policy;

   (2) A statement of the renewal provisions, including anyreservation by the issuer of a right to change premiums, and a disclosure ofthe existence of any automatic renewal premium increase based on thepolicyholder's age; and

   (3) A statement that the outline of coverage is a summary ofthe policy issued or applied for and that the policy should be consulted todetermine governing contractual provisions.

   (c) The director may prescribe by regulation a standard formand the contents of an informational brochure for persons eligible forMedicare, which is intended to improve the buyer's ability to select the mostappropriate coverage and improve the buyer's understanding of Medicare. Exceptin the case of direct response insurance policies, the director may require byregulation that the information brochure be provided to any prospectiveinsureds eligible for Medicare concurrently with delivery of the outline ofcoverage. With respect to direct response insurance policies, the director mayrequire by regulation that the prescribed brochure be provided upon request toany prospective insureds eligible for Medicare, but in no event later than thetime of policy delivery.

   (d) The director may adopt regulations for captions or noticerequirements, determined to be in the public interest and designed to informprospective insured that particular insurance coverage is not Medicaresupplement coverage, for all accident and sickness insurance policies sold topersons eligible for Medicare other than:

   (1) Medicare supplement policies; or

   (2) Disability income policies.

   (e) The director may adopt reasonable regulations to governthe full and fair disclosure of the information in connection with thereplacement of accident and sickness policies, subscriber contracts orcertificates by persons eligible for Medicare.