28 TAC §§3.3818, 3.3829, 3.3830, 3.3839
The Commissioner of Insurance adopts amendments to §§3.3818,
3.3829, 3.3830, and 3.3839 concerning standards for group and individual long-term
care insurance policies and certificates. These sections are adopted with
changes to the proposed text as published in the December 3,1999 issue of
the
Texas Register
(24 TexReg 10792).
These amendments address coverage and benefit level criteria, disclosure
provisions, application requirements, and standards for marketing. The Commissioner
adopts these amendments in response to and after a study of a petition filed
by the National Long Term Care Coalition (a group of large employers) and
Metropolitan Life Insurance Company for a new benefit level criteria for group
long-term care insurance policies and certificates. The individual market
was included in the proposal after the department considered pertinent points
submitted during the rule formulation process.
The amendments apply to both the group and individual long-term care markets.
This gives potential group purchasers similar long-term care product choices
in the individual market in addition to what is offered by the group administrator
and creates more competition among insurers, thus promoting availability and
accessibility of products to all consumers, not just the consumers in the
group market.
An insurer or other qualified entity (hereafter referred to as "insurer")
that offers long-term care coverage in Texas must use physical and mental
standards to determine a covered individual's eligibility for long-term care
benefits, services, or coverage. The physical and mental standards used in
Texas, and required by federal law, are based on an individual's inability
to perform "activities of daily living" (ADL) or "impairment of cognitive
ability." Present rules provide that an individual covered under a long-term
care policy or certificate qualifies for benefits or services when he or she
reaches a state in which the individual cannot perform, without assistance,
any two of the following six ADL functions: bathing, continence, dressing,
eating, toileting, and transferring. An individual also qualifies for benefits
or services under a long-term care policy or certificate if he or she is certified
as being cognitively impaired. Cognitive impairment is reached when an individual's
intellectual capacity has deteriorated to the point whereby that person requires
substantial supervision to protect himself/herself or others. The amendments
to §3.3818 allow, under certain circumstances, a new benefit level for
long-term care coverage. Under §3.3818, an insurer will be allowed to
offer long-term care coverage which provides, in the same policy and/or certificate,
benefits based on a covered individual's inability to perform, without assistance,
two ADL, three ADL, and cognitive impairment. The insurer may offer such a
policy and/or certificate only if all conditions are met.
The amendments require the following safeguards: §3.3818 requires
that the agent of the insurer must also offer the two ADL and cognitive impairment
policy and obtain a written rejection or acknowledgement of such offer; §3.3829
requires that a long-term care insurance policy and/or certificate which includes
a three ADL benefit level shall disclose, within a common location and in
equal prominence, a description of benefits payable for two ADL, three ADL,
and cognitive impairment; §3.3830 provides that an application for a
long-term care policy or certificate containing coverage activated due to
an individual's inability to perform three ADL shall reflect, in equal prominence,
the benefit levels payable for the inability to perform two ADL, three ADL,
and cognitive impairment; and §3.3839 requires that when marketing long-term
care coverage containing a three ADL benefit, an insurer provide in the marketing
material clear and complete information by disclosing in a common location
and in equal prominence benefits payable for two ADL, three ADL, and cognitive
impairment.
GENERAL: Some commenters expressed support for the amendments.
AGENCY RESPONSE: The agency appreciates the comments.
GENERAL: A commenter asked for clarification as to whether the amendments
would affect a resubmission of a form that included benefits based on three
ADL that had been previously filed and disapproved and whether the insurer
would be exempt from offering a group policy that provides benefits based
on two ADL and cognitive impairment and the written rejection since the plan
that would be filed would contain as an integral part, benefits based on two
ADL and cognitive impairment. The commenter questioned whether a written rejection
of the two ADL and cognitive impairment policy would be necessary.
AGENCY RESPONSE: The adopted amendments will have no effect on a policy
filing previously disapproved. The department will consider for approval any
future form filing that complies with the adopted amendments and other applicable
laws and regulations. If a group two/three ADL and cognitive impairment policy
or certificate is offered, a separate two ADL and cognitive impairment policy
or certificate must also be offered and a written rejection or acknowledgment
of offer of the two ADL and cognitive impairment policy or certificate must
be obtained by the insurer or its representative.
GENERAL: Two commenters stated that, if adopted, the amendments should
be limited to a group setting. Both commenters are concerned that the adopted
amendments would create a greater potential for deception by agents and increase
consumer confusion in the individual market. They also suggested testing the
effects of the amendments in the group market before introduction into the
individual market. One of the commenters also opposed the inclusion of the
individual market because this would go beyond the original petition which
was the genesis of the amendments and which limited the proposal to group
markets.
AGENCY RESPONSE: The department disagrees. The amendments should apply
to both group and individual markets to allow all carriers to make more products
available to consumers. If the amendments only applied to group markets, the
individuals in that market being offered a two/three ADL and cognitive impairment
long-term care product through their employer or association would have no
similar product in the individual market with which to compare the group product,
thus limiting their choices. Extending the amendments to both the group and
individual long-term care markets will create more competition among insurers
which will create more products and will put consumers in a better position
to compare and evaluate the coverage offered and the pricing of the coverage.
Although the initial petition addressed groups, after consideration of the
petition and the impact limiting the proposal to the group market would have
on the marketplace as a whole and the limitations it would place on consumers
to adequately evaluate various products, the department decided to include
the individual market in the proposed rule to give individuals the opportunity
to truly have access to the most appropriately priced and beneficial long
term care products.
GENERAL: Two commenters are concerned about the relative value of benefits
of the three ADL benefit levels as compared to those of the two ADL and cognitive
impairment benefit levels within the two/three ADL and cognitive impairment
product as well as the relative value of benefits of the stand-alone two ADL
and cognitive impairment product as compared to the two/three ADL and cognitive
impairment product. The concern is that an insurer will periodically increase
its three ADL benefit levels to reflect the increasing cost of long-term health
care while keeping its two ADL benefit levels stagnate. One commenter recommended
that the amendments should be changed to "require that payment based on inability
to perform two ADL be at least 75% of the benefit based on three ADL." If
the department rejects the 75% concept, the commenter proposed alternative
language based on a reasonableness standard between the two and three ADL
benefit levels.
AGENCY RESPONSE: The department appreciates the commenters' concerns and
is committed to preventing an erosion in the differential between two and
three ADL benefit levels in the form and rate review process. The department
will ensure that unreasonable differentials do not occur between the benefit
levels of the stand-alone two ADL and cognitive impairment product, the benefit
levels of the two ADL component of the two/three ADL and cognitive impairment
product and the benefit levels of the three ADL component of the two/three
ADL and cognitive impairment product. The department also reminds the commenter
of the provisions of §3.3842 which require that companies and agents
make reasonable determinations regarding the appropriateness of the recommended
purchase and §3.3820 which requires inflation protection to be offered
and if selected will address inflationary concerns.
§§3.3818, 3.3829 & 3.3839: Two commenters expressed concern
that adding the three ADL benefit trigger in the two/three ADL and cognitive
impairment product will create consumer confusion. This confusion would stem
from the fact that consumers will not have enough information to compare the
premium and benefit differences between the stand-alone two ADL and cognitive
impairment product and the new two/three ADL and cognitive impairment product
as well as the differences between the two ADL component as compared to the
three ADL component within the two/three and cognitive impairment policy or
certificate. One of the commenters suggested that TDI develop a form and require
agents to fill in comparisons of the two different products' premium costs,
coverages, benefit triggers, and benefits.
AGENCY RESPONSE: In the development of the amendments, the department had
concerns about possible consumer confusion. The department addressed those
concerns by adding §§3.3839(c), 3.3818(b)(2), 3.3830(g) and 3.3829(i)
which the department anticipates will provide consumers ample information
by which they can compare the premium rates and benefits of the two ADL and
cognitive impairment policy or certificate with that of the two/three ADL
and cognitive impairment policy or certificate. In response to comments, the
department changed §3.3818(b)(2) to clarify that the information would
always be provided to the individual to make the decision unless the policy
is issued to a group policyholder who is an employer, labor union or continuing
care retirement center. The amendments require the following safeguards: that
a long-term care two/three ADL and cognitive impairment policy or certificate
and application shall disclose the varying benefits in a common location and
in equal prominence; that the marketing of a long-term care two/three ADL
and cognitive impairment policy or certificate shall disclose all benefit
levels within a common location and in equal prominence; and that if an insurer
offers a two/three ADL and cognitive impairment policy or certificate to a
prospective insured or group policy holder, the agent of the insurer must
also offer the two ADL and cognitive impairment policy and obtain a written
rejection or acknowledgement of such offer. Additionally, the amendments must
be read in conjunction with existing rules, several of which are required
to comply with federal law. Current §3.3838 requires all advertising
to be filed with the department and must comply with Insurance Code Article
21.21 as well as 28 TAC Chapter 21, Subchapter B. Section 3.3839 addresses
standards for marketing which includes a standard that any comparison of policies
will be fair and accurate. Section 3.3832 dictates the content of the outline
of coverage and that it be delivered to prospective applicants. Section 3.3840
requires a shoppers' guide be provided to all prospective applicants. The
department will be revising its shoppers' guide to further educate consumers
regarding these amendments. The department feels that the safeguards in the
amendments and current rules will be very effective in preventing consumer
confusion. In addition, the department recognizes there are other resources
available to assist consumers in evaluating long term care and other coverage,
including the Area Agencies on Aging through the Department on Aging and the
Texas Agriculture Extension Service.
§3.3818: One commenter believes that the language regarding cognitive
impairment is not clear and appears to possibly exclude §3.3818(a)(2)
from §3.3818(b). The commenter proposed alternative language to clarify
what it believes is the department's intent in this regard.
AGENCY RESPONSE: The amendment covers §3.3818(a)(2) in the requirements
relating to §3.3818(b). The department believes that the commenter's
concerns regarding the clarity of the cognitive impairment benefit trigger
is addressed in §3.3818(b)(1)(D) in that the coverage is the same as
that provided for two ADL, but has added clarifying language.
§3.3818: A commenter requested the department to clarify if it intends
that a "company offering a policy under §3.3818(b) must include the same
level of benefits for two ADL in that policy as the policy offered under §3.3818(a)."
AGENCY RESPONSE: The stand-alone two ADL and cognitive impairment policy
or certificate does not have to provide the exact same benefit levels for
the two ADL component of the two/three ADL and cognitive impairment policy
or certificate. However, the two ADL component of the two/three ADL and cognitive
impairment product cannot provide a lower benefit level than a benefit level
that is appropriate for an individual as required by existing §3.3842.
All benefit levels must be reasonable and adequate in relation to standard
market conditions.
For: Continental Casualty Company, American Council of Life Insurance,
Health Insurance Association of America, AEGON Insurance Group. Against::
Consumers Union and Office of Public Insurance Counsel.
The amendments are adopted under the Insurance Code Articles
3.70-12, 3.70-1, 3.51-6, 21.21, and §36.001 and §2001.021 of the
Government Code. Article 3.70-12 provides that the commissioner shall establish
specific standards for provisions of long-term care insurance policies and
standards for full and fair disclosure and for the marketing of long-term
care policies or certificates. It also authorizes the commissioner to issue
any additional rules that are reasonably necessary and proper to carry out
the minimum standards for long-term care insurance policies set forth in Article
3.70-12. Article 3.70-1 provides that the commissioner shall adopt rules and
regulations establishing minimum standards for benefits for long-term care
coverage under individual and group policies and certificates of accident
and sickness insurance delivered or issued for delivery in this state including
group coverages delivered or issued for delivery by companies subject to Chapter
20 of the Texas Insurance Code. Article 3.51-6 authorizes the commissioner
to issue such rules and regulations as may be necessary to carry out provisions
that relate to group coverage. Article 21.21 provides that the commissioner
may promulgate rules to protect the public from unfair or deceptive acts or
practices. Section 36.001 provides that the Commissioner of Insurance may
adopt rules to execute the duties and functions of the Texas Department of
Insurance only as authorized by statute. Section 2001.021 of the Government
Code allows interested individuals or entities to petition a state agency
to adopt requested rules.
§3.3818.Standards for Eligibility for Benefits.
(a)
A long-term care insurance policy or certificate shall
contain provisions conditioning eligibility for benefits or services upon
the occurrence of the following events:
(1)
the inability to perform, without assistance, any two activities
of daily living, as set forth by the insurer; provided, however, that such
activities of daily living shall include at a minimum those which are set
forth and defined in §3.3804 of this title (relating to Definitions);
or
(2)
the impairment of cognitive ability. For purposes
of this subchapter, the term "impairment of cognitive ability" shall not be
defined more restrictively than the deterioration or loss in intellectual
capacity requiring substantial supervision for protection of self or others,
as established by the clinical diagnosis of any licensed practitioner in this
state authorized to make such a diagnosis. Such diagnosis shall include the
patient's history and physical, neurological, psychological and/or psychiatric
evaluations, and laboratory findings.
(b)
Any insurer or other entity that offers a long-term care
insurance policy or certificate that complies with subsection (a) of this
section may also offer a long-term care policy or certificate that provides
coverage based on the inability to perform without assistance any three activities
of daily living, provided:
(1)
the policy or certificate meets the requirements of subparagraphs
(A) through (D) of this paragraph:
(A)
the policy and certificate shall provide coverage based
on meeting the eligibility requirements of subsection (a)(1) of this section,
(B)
the coverage based on the inability to perform, without
assistance, any three activities of daily living shall:
(i)
be identical to the coverage provided under subparagraph
(A) of this paragraph;
(ii)
provide a level of benefits for facility coverage that
is higher than the level of benefits payable for facility coverage under subparagraph
(A) of this paragraph;
(iii)
provide a level of benefits for non-facility coverage
that is not less than the level of benefits payable for non-facility coverage
under subparagraph (A) of this paragraph; however, in complying with §3.3815(c)
of this title (relating to Standards for Home Health and Adult Day Care Benefits),
home health or adult day care services coverage must be a dollar amount equivalent
to at least one-half of one year's coverage available for the nursing home
benefit associated with the corresponding number of activities of daily living.
(C)
the activities of daily living shall include those set
forth and defined in §3.3804 of this title for coverage provided under
subparagraphs (A) and (B) of this paragraph;
(D)
coverage provided based on meeting the eligibility requirements
of subsection (a)(2) of this section for impairment of cognitive ability shall
be identical to the coverage provided under subparagraph (A) of this paragraph
and the benefit level shall not be less than the applicable benefit level
payable under subparagraph (B)(ii) or (B)(iii) of this paragraph; and
(2)
the insurer or other entity shall offer the prospective
insured, or where the policy is offered to a group, the offer required by
provisions of this paragraph shall be made to the group policyholder; except
that in the instance where the group policy will not be issued to an employer,
labor union, or continuing care retirement center, the offering shall be made
to each prospective covered individual, the option to purchase a policy or
certificate that provides benefits set out in subsection (a) of this section
and obtain either: a written rejection of such offer or written acknowledgement
of such offer. Written rejection or acknowledgment of offer may be by a rejection
or acknowledgment receipt, attached to or made part of the application, or
by a certificate of rejection or offer signed by the prospective insured or
group policyholder if the group policyholder will be an employer, labor union,
or continuing care retirement center.
(c)
For purposes of only subsection (b)(1)(B) of this section,
the term "facility," to the extent coverage for care at any of the following
is provided in the policy or certificate, means an assisted living facility,
skilled nursing facility, extended care facility, intermediate care facility,
convalescent nursing home, or maintenance or personal care facility.
§3.3829.Required Disclosure Provisions.
(a)
Long-term care insurance policies and certificates shall
contain a renewability provision as required by §3.3822 of this title
(relating to Minimum Standard for Renewability of Long-term Care Coverage).
Such provision shall be appropriately captioned, shall appear on the first
page of the policy, and shall clearly state the duration, where limited, of
renewability and the duration of the coverage for which the policy is issued
and for which it may be renewed.
(b)
Except for riders or endorsements by which the insurer
effectuates a request made in writing by the policyholder under a long-term
care insurance policy and/or certificate, all riders or endorsements added
to a long-term care insurance policy and/or certificate after the date of
issue or at reinstatement or renewal, which reduce or eliminate benefits or
coverage in the policy and/or certificate, shall require a signed acceptance
by the policyholder. After the date of policy issue, any rider or endorsement
which increases benefits or coverage with a concomitant increase in premium
during the policy term must be agreed to in writing signed by the policyholder,
except if the increased benefits or coverage are required by law. Where a
separate additional premium is charged for benefits in connection with riders
or endorsements, such premium charge shall be set forth in the policy, certificate,
rider, or endorsement.
(c)
A long-term care insurance policy and certificate which
provides for the payment of benefits on standards described as usual and customary,
reasonable and customary, or words of similar import, shall include a definition
of such terms and an explanation of such terms in its accompanying outline
of coverage.
(d)
If a long-term care insurance policy or certificate contains
any limitations with respect to preexisting conditions, such limitations shall
appear as a separate paragraph of the policy or certificate and shall be labeled
as "Preexisting Condition Limitations."
(e)
Long-term care insurance applicants shall have the right
to return the policy or certificate within 30 days of its delivery and to
have the premium refunded if, after examination of the policy or certificate,
the applicant is not satisfied for any reason. Long-term care insurance policies
and certificates shall have a notice prominently printed on the first page
or attached thereto stating in substance that the applicant shall have the
right to return the policy or certificate within 30 days of its delivery and
to have the premium refunded if, after examination of the policy or certificate,
the applicant is not satisfied for any reason.
(f)
A long-term care insurance policy or certificate containing
any limitations or conditions for eligibility other than those prohibited
in the Insurance Code, Article 3.70-12, or §3.3824 of this title (relating
to Preexisting Conditions Provisions) shall set forth a description of such
limitations or conditions in a separate paragraph of the policy and certificate
and shall label each paragraph "Limitations or Conditions on Eligibility for
Benefits."
(g)
Long-term care insurance policies and certificates shall
appropriately caption and describe the nonforfeiture benefit provision, if
elected.
(h)
Long-term care insurance policies and certificates shall
contain a claim denial provision which shall be appropriately captioned. Such
provision shall clearly state that if a claim is denied, the insurer shall
make available all information directly relating to such denial within 60
days of the date of a written request by the policyholder or certificate holder,
unless such disclosure is prohibited under state or federal law.
(i)
A long-term care insurance policy and certificate which
includes benefit provisions under §3.3818(b) of this title (relating
to Standards for Eligibility for Benefits) shall disclose, within a common
location and in equal prominence, a description of all benefit levels payable
for the coverage described in §3.3818(b). Criteria utilized to determine
eligibility for benefits shall be disclosed in all long-term care insurance
policies and certificates, in the manner prescribed by §3.3818.
(j)
If the insurer intends for a long-term care insurance policy
or certificate to be a qualified long-term care insurance contract as defined
by the Internal Revenue Code of 1986, §7702B(b), the policy or certificate
shall include disclosure language substantially similar to the following.
"This policy is intended to be a qualified long-term care contract as defined
by the Internal Revenue Code of 1986, §7702B(b)."
(k)
If the insurer does not intend for the policy to be a qualified
long-term care insurance contract as defined by the Internal Revenue Code
of 1986, §7702B(b), the policy or certificate shall include disclosure
language substantially similar to the following. "This policy is not intended
to be a qualified long-term care insurance contract. This long-term care insurance
policy does not qualify the insured for the favorable tax treatment provided
for in the Internal Revenue Code of 1986, §7702B."
§3.3830.Requirements for Application Forms and Replacement Coverage.
(a)
Individual, direct-response-solicited, and group long-term
care insurance application forms shall include questions designed to elicit
information as to whether, as of the date of application, the applicant has
another long-term care insurance policy or certificate in force or the proposed
insurance is intended to replace any other accident and sickness or long-term
care insurance policy presently in force. A supplementary application or other
form to be signed by the applicant and agent, except where the coverage is
sold without an agent, containing such questions may be used. With regard
to a replacement policy issued to an employer, labor union, or continuing
care retirement community, the following questions may be modified only to
the extent necessary to elicit information about health or long-term care
insurance policies other than the group policy being replaced; provided, however,
that the certificate holder has been notified of the replacement. The following
questions shall be included in the application.
(1)
Do you have another long-term care insurance policy or
certificate in force (including health care service contract, health maintenance
organization contract)?
(2)
Did you have another long-term care insurance policy
or certificate in force during the last 12 months?
(A)
If so, with which company?
(B)
If that policy lapsed, when did it lapse?
(3)
Are you covered by Medicaid?
(4)
Do you intend to replace any of your medical or health
insurance coverage with this policy (certificate)?
(b)
Agents shall list any other health insurance policies and
certificates they have sold to the applicant and shall also:
(1)
list policies and certificates sold which are still in
force;
(2)
list policies and certificates sold in the past five
years which are no longer in force.
(c)
Agents shall list any other health insurance policies or
certificates the applicant has in force.
(d)
Upon a determination that a sale will involve replacement,
an insurer or its agent, if that insurer is other than one using direct-response
solicitation methods, shall furnish the applicant, prior to issuance or delivery
of the individual long-term care insurance policy, a notice regarding replacement
of accident and sickness or long-term care coverage. One copy of such notice
shall be retained by the applicant and an additional copy signed by the applicant
shall be retained by the insurer. The required notice shall be provided in
the following manner.
Figure: 28 TAC §3.3830(d) (No change.)
(e)
Insurers using direct-response solicitation methods shall
deliver a notice regarding replacement of accident and sickness or long-term
care coverage to the applicant upon issuance of the policy or certificate.
The required notice shall be provided in the following manner.
Figure: 28 TAC §3.3830(e) (No change.)
(f)
When replacement is intended, the replacing insurer shall
notify, in writing, the existing insurer of the proposed replacement. The
existing policy or certificate shall be identified by the insurer, name of
the insured, and policy number or address including zip code. Such notice
shall be made within five working days from the date the application is received
by the replacing insurer at its home office, or the date the policy is issued,
whichever is sooner.
(g)
An application for a long-term care policy or certificate
that contains benefits under §3.3818(b) of this title (relating to Standards
for Eligibility for Benefits) shall in equal prominence reflect the benefit
levels payable for the inability to perform two activities of daily living,
three activities of daily living, and cognitive impairment.
§3.3839.Standards for Marketing.
(a)
Every insurer, health care service plan, or other entity
marketing long-term care insurance coverage in this state, directly or through
its agents, shall establish marketing procedures to assure that:
(1)
any comparison of policies by its agents or other producers
will be fair and accurate;
(2)
excessive insurance is not sold or issued;
(3)
every reasonable effort is made to identify whether
a prospective applicant or enrollee for long-term care insurance already has
accident and sickness or long-term care insurance and the types and amounts
of any such insurance;
(4)
no person shall, in selling or offering to sell a
long-term care policy, misrepresent a material fact;
(5)
the policy shall be delivered no later than 30 days
after the application for the long-term care insurance policy or certificate
is approved; and
(6)
auditable procedures are in place to verify compliance
with this subsection.
(b)
Every insurer or other entity marketing long-term care
insurance coverage in this state, directly or through its agents, shall ensure
that the notice provided in paragraph (1) or (2) of this subsection, as appropriate,
is prominently displayed by type, stamp, or other appropriate means on the
first page of both the policy (or certificate) and the outline of coverage.
(1)
For any policy or certificate which contains inflation
protection provisions, the notice shall read as follows: "Notice to buyer:
This policy (or certificate) may not cover all of the costs associated with
long-term care incurred by the policyholder (or certificate holder) during
the period of coverage. The policyholder (or certificate holder) is advised
to review carefully all policy limitations."
(2)
For any policy or certificate which does not contain
inflation protection provisions, the notice shall read as follows: "Notice
to buyer: This policy (or certificate) may not cover all of the costs associated
with long-term care incurred by the policyholder (or certificate holder) during
the period of coverage. The policyholder (or certificate holder) is advised
to review carefully all policy limitations. In addition, the policyholder
(or certificate holder) is advised that based on current health care cost
trends, the benefits provided by this policy (or certificate) may be significantly
diminished in terms of real value to the policyholder (or certificate holder),
depending on the amount of time which elapses between the date of purchase
and the date upon which the policyholder (or certificate holder) first becomes
eligible for those benefits."
(c)
The marketing of a long-term care insurance policy or certificate
which includes benefits provisions under §3.3818(b) of this title (relating
to Standards for Eligibility for Benefits) shall disclose within a common
location and in equal prominence a description of all benefit levels payable
for coverage described in §3.3818(b).
(d)
In addition to the practices prohibited in the Insurance
Code, Article 21.21, the following acts and practices in the marketing of
long-term care policies or certificates in this state are prohibited.
(1)
Twisting-Knowingly making any misleading representation
or incomplete or fraudulent comparisons of any insurance policies or insurers
for the purpose of inducing, or tending to induce, any person to lapse, forfeit,
surrender, terminate, retain, pledge, assign, borrow on, or convert any insurance
policy or to take out a policy of insurance with another insurer.
(2)
High pressure tactics-Employing any method of marketing
having the effect of or tending to induce the purchase of insurance through
force, fright, threat, whether explicit or implied, or undue pressure to purchase
or recommend the purchase of insurance.
(3)
Cold lead advertising-Making use directly or indirectly
of any method of marketing which fails to disclose in a conspicuous manner
that a purpose of the method of marketing is solicitation of insurance and
that contact will be made by an insurance agent or insurance company.
(4)
Misrepresentation-Selling, marketing, offering, or
advertising any insurance policy, certificate, or rider to such policy or
certificate, which substantially meets the definition of long-term care insurance
found in the Insurance Code Article 3.70-12, §2, but which provides benefits
for a period of fewer than 12 months.
This agency hereby certifies that the adoption has been
reviewed by legal counsel and found to be a valid exercise of the agency's
legal authority.
Filed with the Office of
the Secretary of State on February 9, 2000.
TRD-200001009
Lynda Nesenholtz
General Counsel and Chief Clerk
Texas Department of Insurance
Effective date: February 29, 2000
Proposal publication date: December 3, 1999
For further information, please call: (512) 463-6327