376.426. Group health policies, required provisions.
Group health policies, required provisions.
376.426. No policy of group health insurance shall be delivered in thisstate unless it contains in substance the following provisions, or provisionswhich in the opinion of the director of the department of insurance, financialinstitutions and professional registration are more favorable to the personsinsured or at least as favorable to the persons insured and more favorable tothe policyholder; except that: provisions in subdivisions (5), (7), (12),(15), and (16) of this section shall not apply to policies insuring debtors;standard provisions required for individual health insurance policies shallnot apply to group health insurance policies; and if any provision of thissection is in whole or in part inapplicable to or inconsistent with thecoverage provided by a particular form of policy, the insurer, with theapproval of the director, shall omit from such policy any inapplicableprovision or part of a provision, and shall modify any inconsistent provisionor part of the provision in such manner as to make the provision as containedin the policy consistent with the coverage provided by the policy:
(1) A provision that the policyholder is entitled to a grace period ofthirty-one days for the payment of any premium due except the first, duringwhich grace period the policy shall continue in force, unless the policyholdershall have given the insurer written notice of discontinuance in advance ofthe date of discontinuance and in accordance with the terms of the policy.The policy may provide that the policyholder shall be liable to the insurerfor the payment of a pro rata premium for the time the policy was in forceduring such grace period;
(2) A provision that the validity of the policy shall not be contested,except for nonpayment of premiums, after it has been in force for two yearsfrom its date of issue, and that no statement made by any person covered underthe policy relating to insurability shall be used in contesting the validityof the insurance with respect to which such statement was made after suchinsurance has been in force prior to the contest for a period of two yearsduring such person's lifetime nor unless it is contained in a writteninstrument signed by the person making such statement; except that, no suchprovision shall preclude the assertion at any time of defenses based upon theperson's ineligibility for coverage under the policy or upon other provisionsin the policy;
(3) A provision that a copy of the application, if any, of thepolicyholder shall be attached to the policy when issued, that all statementsmade by the policyholder or by the persons insured shall be deemedrepresentations and not warranties and that no statement made by any personinsured shall be used in any contest unless a copy of the instrumentcontaining the statement is or has been furnished to such person or, in theevent of the death or incapacity of the insured person, to the individual'sbeneficiary or personal representative;
(4) A provision setting forth the conditions, if any, under which theinsurer reserves the right to require a person eligible for insurance tofurnish evidence of individual insurability satisfactory to the insurer as acondition to part or all of the individual's coverage;
(5) A provision specifying the additional exclusions or limitations, ifany, applicable under the policy with respect to a disease or physicalcondition of a person, not otherwise excluded from the person's coverage byname or specific description effective on the date of the person's loss, whichexisted prior to the effective date of the person's coverage under the policy. Any such exclusion or limitation may only apply to a disease or physicalcondition for which medical advice or treatment was received by the personduring the twelve months prior to the effective date of the person's coverage. In no event shall such exclusion or limitation apply to loss incurred ordisability commencing after the earlier of:
(a) The end of a continuous period of twelve months commencing on orafter the effective date of the person's coverage during all of which theperson has received no medical advice or treatment in connection with suchdisease or physical condition; or
(b) The end of the two-year period commencing on the effective date ofthe person's coverage;
(6) If the premiums or benefits vary by age, there shall be a provisionspecifying an equitable adjustment of premiums or of benefits, or both, to bemade in the event the age of the covered person has been misstated, suchprovision to contain a clear statement of the method of adjustment to be used;
(7) A provision that the insurer shall issue to the policyholder, fordelivery to each person insured, a certificate setting forth a statement as tothe insurance protection to which that person is entitled, to whom theinsurance benefits are payable, and a statement as to any family member's ordependent's coverage;
(8) A provision that written notice of claim must be given to theinsurer within twenty days after the occurrence or commencement of any losscovered by the policy. Failure to give notice within such time shall notinvalidate nor reduce any claim if it shall be shown not to have beenreasonably possible to give such notice and that notice was given as soon aswas reasonably possible;
(9) A provision that the insurer shall furnish to the person makingclaim, or to the policyholder for delivery to such person, such forms as areusually furnished by it for filing proof of loss. If such forms are notfurnished before the expiration of fifteen days after the insurer receivesnotice of any claim under the policy, the person making such claim shall bedeemed to have complied with the requirements of the policy as to proof ofloss upon submitting, within the time fixed in the policy for filing proof ofloss, written proof covering the occurrence, character, and extent of the lossfor which claim is made;
(10) A provision that in the case of claim for loss of time fordisability, written proof of such loss must be furnished to the insurer withinninety days after the commencement of the period for which the insurer isliable, and that subsequent written proofs of the continuance of suchdisability must be furnished to the insurer at such intervals as the insurermay reasonably require, and that in the case of claim for any other loss,written proof of such loss must be furnished to the insurer within ninety daysafter the date of such loss. Failure to furnish such proof within such timeshall not invalidate nor reduce any claim if it was not reasonably possible tofurnish such proof within such time, provided such proof is furnished as soonas reasonably possible and in no event, except in the absence of legalcapacity of the claimant, later than one year from the time proof is otherwiserequired;
(11) A provision that all benefits payable under the policy other thanbenefits for loss of time shall be payable not more than thirty days afterreceipt of proof and that, subject to due proof of loss, all accrued benefitspayable under the policy for loss of time shall be paid not less frequentlythan monthly during the continuance of the period for which the insurer isliable, and that any balance remaining unpaid at the termination of suchperiod shall be paid as soon as possible after receipt of such proof;
(12) A provision that benefits for accidental loss of life of a personinsured shall be payable to the beneficiary designated by the person insuredor, if the policy contains conditions pertaining to family status, thebeneficiary may be the family member specified by the policy terms. In eithercase, payment of these benefits is subject to the provisions of the policy inthe event no such designated or specified beneficiary is living at the deathof the person insured. All other benefits of the policy shall be payable tothe person insured. The policy may also provide that if any benefit ispayable to the estate of a person, or to a person who is a minor or otherwisenot competent to give a valid release, the insurer may pay such benefit, up toan amount not exceeding two thousand dollars, to any relative by blood orconnection by marriage of such person who is deemed by the insurer to beequitably entitled thereto;
(13) A provision that the insurer shall have the right and opportunity,at the insurer's own expense, to examine the person of the individual for whomclaim is made when and so often as it may reasonably require during thependency of the claim under the policy and also the right and opportunity, atthe insurer's own expense, to make an autopsy in case of death where it is notprohibited by law;
(14) A provision that no action at law or in equity shall be brought torecover on the policy prior to the expiration of sixty days after proof ofloss has been filed in accordance with the requirements of the policy and thatno such action shall be brought at all unless brought within three years fromthe expiration of the time within which proof of loss is required by thepolicy;
(15) A provision specifying the conditions under which the policy may beterminated. Such provision shall state that except for nonpayment of therequired premium or the failure to meet continued underwriting standards, theinsurer may not terminate the policy prior to the first anniversary date ofthe effective date of the policy as specified therein, and a notice of anyintention to terminate the policy by the insurer must be given to thepolicyholder at least thirty-one days prior to the effective date of thetermination. Any termination by the insurer shall be without prejudice to anyexpenses originating prior to the effective date of termination. An expensewill be considered incurred on the date the medical care or supply isreceived;
(16) A provision stating that if a policy provides that coverage of adependent child terminates upon attainment of the limiting age for dependentchildren specified in the policy, such policy, so long as it remains in force,shall be deemed to provide that attainment of such limiting age does notoperate to terminate the hospital and medical coverage of such child while thechild is and continues to be both incapable of self-sustaining employment byreason of mental or physical handicap and chiefly dependent upon thecertificate holder for support and maintenance. Proof of such incapacity anddependency must be furnished to the insurer by the certificate holder at leastthirty-one days after the child's attainment of the limiting age. The insurermay require at reasonable intervals during the two years following the child'sattainment of the limiting age subsequent proof of the child's incapacity anddependency. After such two-year period, the insurer may require subsequentproof not more than once each year. This subdivision shall apply only topolicies delivered or issued for delivery in this state on or after onehundred twenty days after September 28, 1985;
(17) A provision stating that if a policy provides that coverage of adependent child terminates upon attainment of the limiting age for dependentchildren specified in the policy, such policy, so long as it remains in force,until the dependent child attains the limiting age, shall remain in force atthe option of the certificate holder. Eligibility for continued coverageshall be established where the dependent child is:
(a) Unmarried and no more than that twenty-five years of age; and
(b) A resident of this state; and
(c) Not provided coverage as a named subscriber, insured, enrollee, orcovered person under any group or individual health benefit plan, or entitledto benefits under Title XVIII of the Social Security Act, P.L. 89-97, 42U.S.C. Section 1395, et seq.;
(18) In the case of a policy insuring debtors, a provision that theinsurer shall furnish to the policyholder for delivery to each debtor insuredunder the policy a certificate of insurance describing the coverage andspecifying that the benefits payable shall first be applied to reduce orextinguish the indebtedness.
(L. 1985 H.B. 623, A.L. 2007 H.B. 818)Effective 1-01-08