§ 27-34.2-7.1 - Incontestability period. - Rhode Island Statutes

SECTION 27-34.2-7.1

   § 27-34.2-7.1  Incontestability period.– (a) For a policy or certificate that has been in force for less than six (6)months an insurer may rescind a long-term care insurance policy or certificateor deny an otherwise valid long-term care insurance claim upon a showing ofmisrepresentation that is material to the acceptance for coverage.

   (b) For a policy or certificate that has been in force for atleast six (6) months, but less than two (2) years, an insurer may rescind along-term care insurance policy or certificate or deny an otherwise validlong-term care insurance claim upon a showing of misrepresentation that is bothmaterial to the acceptance for coverage and which pertains to the condition forwhich benefits are sought.

   (c) After a policy or certificate has been in force for two(2) years it is not contestable upon the grounds of misrepresentation alone;the policy or certificate may be contested only upon a showing that the insuredknowingly and intentionally misrepresented relevant facts relating to theinsured's health.

   (d) A long-term care insurance policy or certificate may befield issued if the compensation to the field issuer is not based on the numberof policies or certificates issued. For the purposes of this section, "fieldissued" means a policy or certificate issued by a producer or a third-partyadministrator pursuant to the underwriting authority granted to the producer orthird-party administrator by an insurer and using the insurer's underwritingguidelines.

   (e) If an insurer has paid benefits under the long-term careinsurance policy or certificate, the benefit payments may not be recovered bythe insurer in the event that the policy or certificate is rescinded.

   (f) In the event of the death of the insured, this sectionshall not apply to the remaining death benefit of a life insurance policy thataccelerates benefits for long-term care. In this situation, the remaining deathbenefits under these policies shall be governed by chapter 4 of this title. Inall other situations, this section shall apply to life insurance policies thataccelerate benefits for long-term care.