Chapter 18 - Disability Insurance Policies
CHAPTER 18 - DISABILITY INSURANCE POLICIES
ARTICLE 1 - GENERAL PROVISIONS
26-18-101. Short title.
Thischapter may be cited as the "Uniform Disability Policy ProvisionLaw".
26-18-102. Scope and applicability of chapter.
(a) Nothing in this chapter applies to or affects:
(i) Any policy of liability or worker's compensation insurancewith or without supplementary expense coverage therein;
(ii) Any group or blanket policy;
(iii) Life insurance, endowment or annuity contracts, orcontracts supplemental thereto which contain only those provisions relating todisability insurance as:
(A) Provide additional benefits in case of death ordismemberment or loss of sight by accident or accidental means; or
(B) Operate to safeguard the contracts against lapse, or togive a special surrender value or special benefit or an annuity in case theinsured or annuitant is totally and permanently disabled as defined by thecontract or supplemental contract.
(iv) Reinsurance;
(v) Any contract made or issued prior to January 1, 1968,together with any extensions, renewals, reinstatements or modifications thereofor amendments thereto whenever made.
26-18-103. General requirements for policies.
(a) No disability insurance policy shall be delivered or issuedfor delivery to any person in this state unless it otherwise complies with thiscode and the following:
(i) The entire money and other considerations therefor shall beexpressed in the policy;
(ii) The time when the insurance takes effect and terminatesshall be expressed in the policy;
(iii) It shall purport to insure only one (1) person, except thata policy may insure, originally or by subsequent amendment, upon theapplication of an adult member of a family, who is deemed the policyholder, anytwo (2) or more eligible members of that family, including husband, wife,dependent children or any children under a specified age not exceeding nineteen(19) years and any other person dependent upon the policyholder;
(iv) The style, arrangement and overall appearance of the policyshall give no undue prominence to any portion of the text, and any printedportion of the text and any endorsements or attached papers shall be plainlyprinted in lightfaced type of a style in general use, the size of which shallbe uniform and not less than ten (10) point with a lower case unspaced alphabetlength not less than one hundred twenty (120) point;
(v) The "text" shall include all printed matterexcept the insurer's name and address, the policy name or title, the briefdescription, if any, and captions and subcaptions;
(vi) The exceptions and reductions of indemnity shall be setforth in the policy and, other than those contained in W.S. 26-18-105 through26-18-127, shall be printed, at the insurer's option, either included with thebenefit provision to which they apply or under an appropriate caption such as"Exceptions", or "Exceptions and Reductions", except thatif an exception or reduction specifically applies to a particular policy benefit,a statement of that exception or reduction shall be included with the benefitprovision to which it applies;
(vii) Each form, including riders and endorsements, shall beidentified by a form number in the lower left-hand corner of the first page;
(viii) The policy shall not contain any provision purporting tomake any portion of the insurer's charter, rules, constitution or bylaws a partof the policy unless that portion is set forth in full in the policy, except inthe case of the incorporation of or reference to a statement of rates,classification of risks or short-rate table filed with the commissioner;
(ix) If issued or delivered on or after January 1, 1999, thepolicy shall provide a notice on the face of the policy of not less than fourteen(14) point bold type, as to the extent to which the policy includescomprehensive adult wellness benefits as defined in subsection (b) of thissection. To insure that the disclosure has been made, the notice shall includespace for the signature of the policyholder and the sales representative on thedisclosure statement. The disclosure statement must be signed by the applicantand sales representative at the time of the policy application. No policy shallbe represented as containing comprehensive adult wellness benefits unless thepolicy meets the criteria specified under subsection (b) of this section. Ifcoverage is included, the notice shall make reference to the exact locationwithin the policy where the level and extent of coverage is described indetail. If coverage is not included, the notice shall state that the policydoes not contain comprehensive adult wellness benefits as defined by law. Thisstatement shall also be placed in a prominent location on any materials used inrepresenting the policy, including sales materials. The department of insuranceshall prescribe the form and content of the notice required under thisparagraph. This paragraph does not apply to any policy with a deductible offive thousand dollars ($5,000.00) or more.
(b) As used in paragraph (a)(ix) of this section,"comprehensive adult wellness benefits" means benefits not subject topolicy deductibles, which provide a minimum benefit equal to eighty percent(80%) of the reimbursement allowance under the private health benefit plan witha maximum of twenty percent (20%) coinsurance by the insured and which providea benefit structure to the insured equal to a minimum of one hundred fiftydollars ($150.00) per insured adult per calendar year, or a benefit structure ofsimilar actuarial value to the insured. In addition, the benefits shall atminimum provide for testing procedures and for the examination of adultpolicyholders and their spouses for breast cancer, prostate cancer, cervicalcancer and diabetes.
26-18-104. Standard policy provisions; substitutions and omissions.
(a) Except as provided in subsection (b) of this section, anypolicy delivered or issued for delivery to any person in this state shallcontain the provisions specified in W.S. 26-18-105 through 26-18-116, in thewords in which the provisions appear, except that with the commissioner'sapproval the insurer may substitute for any of the provisions correspondingprovisions of different wording which are in each instance not less favorablein any respect to the insured or the beneficiary. Each such provision shall bepreceded individually by the applicable caption shown, or, at the insurer'soption, by any appropriate individual or group captions or subcaptions thecommissioner approves.
(b) If any provision or part thereof is inapplicable to orinconsistent with the coverage provided by a particular form of policy, theinsurer, with the commissioner's approval, shall omit from the policy theinapplicable provision or part and shall modify any inconsistent provision orpart to make the provision as contained in the policy consistent with thecoverage the policy provides.
26-18-105. Policy constitutes entire contract; changes in policy.
"EntireContract; Changes: This policy, including the endorsements and the attachedpapers, if any, constitutes the entire contract of insurance. No change in thispolicy is valid until approved by an executive officer of the insurer andunless the approval is endorsed on or attached to this policy. No agent has authorityto change this policy or to waive any of its provisions."
26-18-106. Time limit on certain defenses.
(a) "Time Limit on Certain Defenses: After three (3) yearsfrom the date of issue of this policy no misstatements, except fraudulentmisstatements, made by the applicant in the application for the policy shall beused to void the policy or to deny a claim for loss incurred or disability, asdefined in the policy, commencing after the expiration of the three (3) yearperiod."
(i) This time limit shall not be so construed as to affect anylegal requirement for avoidance of a policy or denial of a claim during theinitial three (3) year period, nor to limit the application of W.S. 26-18-118through 26-18-121 in case of misstatement with respect to age or occupation orother insurance;
(ii) A policy which the insured has the right to continue inforce subject to its terms by the timely payment of premium until at least agefifty (50) or in the case of a policy issued after age forty-four (44), for atleast five (5) years from its date of issue, may contain instead of the"time limit on certain defenses" provision of this section thefollowing provision (from which paragraph (i) of this subsection may be omittedat the insurer's option) under the caption "Incontestable: After thispolicy is in force for a period of three (3) years during the insured'slifetime, excluding any period during which the insured is disabled, it isincontestable as to the statements contained in the application."
(b) "Except for the preexisting condition provision statedin this subsection, no claim for loss incurred or disability, as defined in thepolicy, shall be reduced or denied due to a preexisting condition not excludedfrom coverage by name or specific description effective on the date of loss. This preexisting condition provision shall not exclude coverage for a periodbeyond twelve (12) months following the individual's effective date of coverageand shall only relate to conditions for which medical advice, diagnosis, careor treatment was recommended or received during the six (6) months immediatelypreceding the effective date of coverage or as to a pregnancy existing on theeffective date of coverage."
(c) In determining whether a preexisting condition provisionapplies to an insured or dependent, all private or public health benefit plansshall credit the time the person was previously covered by a private or publichealth benefit plan if the previous coverage was continuous to a date not morethan ninety (90) days prior to the effective date of the new coverage. In thecase of a preexisting conditions limitation allowable in the succeedingcarrier's plan, the level of benefits applicable to preexisting conditions orpersons becoming covered by the succeeding carrier's plan during the period oftime this limitation applies under the new plan shall be the lesser of:
(i) The benefits of the new plan determined without applicationof the preexisting conditions limitation; or
(ii) The benefits of the prior plan.
26-18-107. Grace period.
(a) "A grace period of .... (insert a number not less than"7" for weekly premium policies, "10" for monthly premiumpolicies and "31" for all other policies) days shall be granted forthe payment of each premium falling due after the first premium, during whichgrace period the policy shall continue in force."
(b) A policy in which the insurer reserves the right to refuseany renewal shall have at the beginning of the provision specified insubsection (a) of this section: "Unless not less than five (5) days priorto the premium due date the insurer delivers to the insured or mails to hisaddress, as shown by the insurer's records, written notice of its intention notto renew this policy beyond the period for which the premium has beenaccepted."
26-18-108. Reinstatement.
(a) "Reinstatement: If any renewal premium is not paidwithin the time granted the insured for payment, a subsequent acceptance ofpremium by the insurer or by any agent authorized by the insurer to accept thepremium, without requiring an application for reinstatement, reinstates thepolicy. If the insurer or the agent requires an application for reinstatementand issues a conditional receipt for the premium tendered, the policy shall bereinstated upon the insurer's approval of the application, or, lacking thatapproval, upon the forty-fifth day following the date of the conditionalreceipt unless the insurer previously notified the insured in writing of itsdisapproval of the application. The reinstated policy covers only lossresulting from an accidental injury sustained after the date of reinstatementand loss due to any sickness beginning more than ten (10) days after that date.In all other respects the insured and insurer have the same rights under thepolicy as they had immediately before the due date of the defaulted premium,subject to any provisions endorsed on or attached to this policy in connectionwith the reinstatement. Any premium accepted in connection with a reinstatementshall be applied to a period for which premium has not been previously paid,but not to any period more than sixty (60) days prior to the date ofreinstatement."
(b) The last sentence of the provision in subsection (a) ofthis section may be omitted from any policy which the insured has the right tocontinue in force subject to its terms by the timely payment of premiums:
(i) Until at least age fifty (50); or
(ii) In the case of a policy issued after age forty-four (44),for at least five (5) years from its date of issue.
26-18-109. Notice of claim; loss-of-time benefit.
(a) "Notice of Claim: Written notice of claim shall begiven to the insurer within sixty (60) days after the occurrence orcommencement of any loss covered by the policy, or as soon thereafter as isreasonably possible. Notice given by or on behalf of the insured or thebeneficiary to the insurer at .... (insert the location of the office theinsurer designates for the purpose), or to any authorized agent of the insurer,with information sufficient to identify the insured, is deemed notice to theinsurer."
(b) In a policy providing a loss-of-time benefit which may bepayable for at least two (2) years, an insurer may insert the following betweenthe first and second sentence of the provision specified in subsection (a) ofthis section: "Subject to the qualifications set forth in this provision,if the insured suffers loss of time because of disability for which indemnityis payable for at least two (2) years, at least once in every six (6) monthsafter having given notice of the claim, he shall give to the insurer notice ofcontinuance of the disability, except in the event of legal incapacity. Theperiod of six (6) months following any filing of proof by the insured or anypayment by the insurer because of the claim or any denial of liability in wholeor in part by the insurer shall be excluded in applying this provision. Delayin giving the notice does not impair the insured's right to any indemnity whichwould otherwise have accrued during the period of six (6) months preceding thedate on which the notice is actually given."
26-18-110. Claim forms.
"ClaimForms: The insurer, upon receipt of a notice of claim, will furnish to theclaimant the forms it usually furnishes for filing proofs of loss. If the formsare not furnished within fifteen (15) days after giving notice, the claimant isdeemed to have complied with the requirements of this policy as to proof ofloss upon submitting, within the time fixed in the policy for filing proofs ofloss, written proof covering the occurrence, the character and extent of theloss for which claim is made."
26-18-111. Proofs of loss.
"Proofsof Loss: Written proof of loss shall be furnished to the insurer at its officein case of claim for loss for which this policy provides any periodic payment,contingent upon continuing loss within ninety (90) days after the terminationof the period for which the insurer is liable, and in case of claim for anyother loss within ninety (90) days after the date of the loss. Failure tofurnish proof within the time required does not invalidate nor reduce any claimif it is not reasonably possible to give proof within that time, provided theproof is furnished as soon as reasonably possible and, except in the absence oflegal capacity, not later than one (1) year from the time proof is otherwiserequired."
26-18-112. Time of payment of claims.
"Timeof Payment of Claims: Indemnities payable under this policy for any loss, otherthan loss for which this policy provides any periodic payment, shall be paidimmediately upon receipt of written proof of the loss. Subject to written proofof loss, all accrued indemnities for loss for which this policy providesperiodic payment shall be paid .... (insert period for payment which shall notbe less frequently than monthly) and any balance remaining unpaid upon thetermination of liability shall be paid immediately upon receipt of writtenproof."
26-18-113. Payment of claims.
(a) "Payment of Claims: Indemnity for loss of life ispayable in accordance with the beneficiary designation and the provisionsrespecting that payment which may be prescribed in this policy and effective atthe time of payment. If no designation or provision is then effective, theindemnity is payable to the insured's estate. Any other accrued indemnitiesunpaid at the insured's death, at the insurer's option, may be paid either tothe beneficiary or to the estate. Any other indemnities are payable to theinsured."
(b) Either or both of the following provisions may be includedwith the provision specified in subsection (a) of this section at the insurer'soption:
(i) "If any indemnity of this policy is payable to theinsured's estate, or to an insured or beneficiary who is a minor or otherwisenot competent to give a valid release, the insurer may pay the indemnity, up toan amount not exceeding $.... (insert an amount which shall not exceed $1,000),to any relative by blood or connection by marriage of the insured orbeneficiary whom the insurer deems to be equitably entitled thereto. Anypayment the insurer makes in good faith pursuant to this provision dischargesthe insurer to the extent of the payment."
(ii) "Subject to the insured's written direction in theapplication or otherwise, all or a portion of any indemnities provided by thispolicy because of hospital, nursing, medical or surgical services, at theinsurer's option and unless the insured requests otherwise in writing not laterthan the time of filing proofs of the loss, may be paid directly to thehospital or person rendering the services, but it is not required that theservice be rendered by a particular hospital or person."
26-18-114. Physical examination and autopsy.
"PhysicalExaminations and Autopsy: The insurer at its own expense has the right toexamine the person of the insured when and as often as it reasonably requiresduring the pendency of a claim under the policy and to make an autopsy in caseof death if it is not forbidden by law."
26-18-115. Legal actions.
"LegalActions: No action at law or in equity shall be brought to recover on thispolicy prior to the expiration of sixty (60) days after written proof of lossis furnished in accordance with the requirements of this policy. No such actionshall be brought after the expiration of three (3) years after the time writtenproof of loss is required to be furnished."
26-18-116. Change of beneficiary.
(a) "Change of Beneficiary: Unless the insured makes anirrevocable designation of beneficiary, the right to change the beneficiary isreserved to the insured, and the consent of the beneficiary is not requisite tothe surrender or assignment of this policy or to any change of beneficiary, orto any other changes in this policy."
(b) The clause relating to the irrevocable designation ofbeneficiary may be omitted at the insurer's option.
26-18-117. Optional policy provisions.
Exceptas provided in W.S. 26-18-104(b), no disability insurance policy delivered orissued for delivery to any person in this state shall contain provisions as setforth in W.S. 26-18-118 through 26-18-127 unless the wording of thoseprovisions is the same as it appears in the applicable section, except that theinsurer may use a corresponding provision of different wording the commissionerapproves which is not less favorable in any respect to the insured or thebeneficiary. The corresponding provision shall be preceded individually by theappropriate caption or, at the insurer's option, by appropriate individual orgroup captions or subcaptions the commissioner approves.
26-18-118. Change of occupation.
"Changeof Occupation: If the insured is injured or becomes ill after having changedhis occupation to one the insurer classifies as more hazardous than that statedin this policy or while doing for compensation anything pertaining to anoccupation so classified, the insurer shall pay only that portion of theindemnities provided in this policy as the premium paid would have purchased atthe rates and within the limits fixed by the insurer for the more hazardousoccupation. If the insured changes his occupation to one the insurer classifiesas less hazardous than that stated in this policy, the insurer, upon receipt ofproof of the change of occupation, shall reduce the premium rate accordingly,and shall return the excess pro rata unearned premium from the date of changeof occupation or from the policy anniversary date immediately preceding receiptof the proof, whichever is more recent. In applying this provision, the classificationof occupational risk and the premium rates shall be those the insurer lastfiled, prior to the occurrence of the loss for which the insurer is liable orprior to date of proof of change in occupation, with the state official havingsupervision of insurance in the state where the insured resided at the timethis policy was issued. If the filings specified were not required, then theclassification of occupational risk and the premium rates shall be those theinsurer last made effective in that state prior to the occurrence of the lossor prior to the date of proof of change in occupation."
26-18-119. Misstatement of age.
"Misstatementof Age: If the insured's age is misstated, all amounts payable under thispolicy shall be such as the premium paid would have purchased at the correctage."
26-18-120. Overinsurance; same insurer.
"Ifany accident or sickness or accident and sickness policy previously issued bythe insurer to the insured is in force concurrently with this policy, makingthe aggregated indemnity for .... (insert type of coverage or coverages) inexcess of $.... (insert maximum limit of indemnity or indemnities), the excessinsurance is void and all premiums paid for the excess shall be returned to theinsured or to his estate." or, instead: "Insurance effective at anyone time on the insured under this policy and a like policy in this insurer islimited to one (1) policy the insured, his beneficiary or his estate elects,and the insurer shall return all premiums paid for the other policies."
26-18-121. Overinsurance; all coverages.
(a) "Overinsurance: If, with respect to a person coveredunder this policy, benefits for allowable expense incurred during a claimdetermination period under this policy together with benefits for allowableexpense during that period under all other valid coverage, without givingeffect to this provision or to any 'overinsurance provision' applying to theother valid coverage, exceed the total of the person's allowable expense duringthe period, this insurer is liable only for the proportionate amount of thebenefits for allowable expense under this policy during the period as:
(i) The total allowable expense during the period bears to:
(A) The total amount of benefits payable during the period forthe expense under this policy and all other valid coverage, without givingeffect to this provision or to any 'overinsurance provision' applying to theother valid coverage; less
(B) In this paragraph any amount of benefits for allowableexpenses payable under other valid coverage which does not contain anoverinsurance provision.
(b) The provisions of subsection (a) of this section do notoperate to increase the amount of benefits for allowable expense payable underthis policy with respect to a person covered under this policy above the amountwhich would have been paid in the absence of these provisions. This insurer maypay benefits to any insurer providing other valid coverage in case ofoverpayment by the insurer. Any such payment discharges this insurer'sliability as fully as if the payment is made directly to the insured, hisassignee or his beneficiary. If this insurer pays benefits to the insured, hisassignee or his beneficiary, exceeding the amount payable if the existence ofother valid coverage had been disclosed, this insurer has a right of actionagainst the insured, his assignee or his beneficiary to recover the amountwhich would not have been paid had there been a disclosure of the existence ofother valid coverage. The amount of other valid coverage which is on aprovision of service basis shall be computed as the amount the servicesrendered would have cost in the absence of that coverage.
(c) For the purpose of the provisions in subsections (a) and(b) of this section:
(i) 'Allowable expense' means one hundred ten percent (110%) ofany necessary, reasonable and customary item of expense which is covered, inwhole or part, as a hospital, surgical, medical or major medical expense underthis policy or under any other valid coverage;
(ii) 'Claim determination period' with respect to any coveredperson means the initial period of .... (insert period of not less than thirtydays) and each successive period of a like number of days, during whichallowable expense covered under this policy is incurred because of that person.The first period begins on the date when the first expense is incurred, andsuccessive periods begin when an expense is incurred after expiration of aprior period, or, instead: 'Claim determination period' with respect to anycovered persons means .... (insert calendar or policy period of not less than amonth) during which allowable expense covered under this policy is incurredbecause of that person;
(iii) 'Overinsurance provision' means this provision and anyother provision which may reduce an insurer's liability because of theexistence of benefits under other valid coverage."
(d) The policy provisions specified in subsections (a) through(c) of this section may be inserted in all policies providing hospital,surgical, medical or major medical benefits. The insurer may make thisprovision applicable to either or both other valid coverage with other insurersand other valid coverage with the same insurer. The insurer shall include inthis provision a definition of "other valid coverage" approved as toform by the commissioner. The term may include hospital, surgical, medical ormajor medical benefits provided by group, blanket or franchise coverage,individual and family-type coverage, Blue Cross-Blue Shield coverage and otherprepayment plans, group practice and individual practice plans, uninsuredbenefits provided by labor-management trusteed plans, or union welfare plans,or by employer or employee benefit organizations, benefits provided under governmentalprograms, worker's compensation insurance or any coverage required or providedby any other statute, and medical payments under automobile liability andpersonal liability policies. Other valid coverage does not include paymentsmade under third party liability coverage as a result of a determination ofnegligence, but an insurer may include a subrogation clause in its policy. Aspart of the proof of claim, the insurer may require the information necessaryto administer this provision.
26-18-122. Relation of earnings to insurance.
(a) "After the loss-of-time benefit of this policy hasbeen payable for ninety (90) days, that benefit shall be adjusted, as providedin this section, if the total amount of unadjusted loss-of-time benefitsprovided in all valid loss-of-time coverage upon the insured exceeds .... % ofthe insured's earned income. However, if the information contained in theapplication discloses that the total amount of loss-of-time benefits under thispolicy and under all other valid loss-of-time coverage expected to be effectiveupon the insured in accordance with the application for this policy exceeded.... % of the insured's earned income at the time of the application, thehigher percentage shall be used in the place of .... %. The adjustedloss-of-time benefit under this policy for any month shall be only thatproportion of the loss-of-time benefit otherwise payable under this policy as:
(i) The product of the insured's earned income and .... % or,if higher, the alternative percentage described at the end of the firstsentence of this provision bears to;
(ii) The total amount of loss-of-time benefits payable for thatmonth under this policy and all other valid loss-of-time coverage on theinsured, without giving effect to the overinsurance provision in this or anyother coverage; less
(iii) In both paragraphs (i) and (ii) of this subsection anyamount of loss-of-time benefits payable under other valid loss-of-time coveragewhich does not contain an 'overinsurance provision'.
(b) In making the computation specified in subsection (a) ofthis section, all benefits and earnings shall be converted to a consistent(insert 'weekly' if the loss-of-time benefit of this policy is payable weekly,'monthly' if the benefit is payable monthly, etc.) basis. If the numerator ofthe ratio obtained in the computation in subsection (a) of this section is zeroor is negative, no benefit is payable under this policy. This provision doesnot operate to:
(i) Reduce the total combined amount of loss-of-time benefitsfor the month payable under this policy and all other valid loss-of-timecoverage below the lesser of three hundred dollars ($300.00) and the totalcombined amount of loss-of-time benefits determined without giving effect toany 'overinsurance provision';
(ii) Increase the amount of benefits payable under this policyabove the amount which would have been paid in the absence of this provision;nor
(iii) Take into account or reduce any benefit other than theloss-of-time benefit.
(c) For the purpose of subsections (a) and (b) of this section:
(i) 'Earned income', unless otherwise specified, means thegreater of the monthly earnings of the insured at the time disability commencesand his average monthly earnings for a period of two (2) years immediatelypreceding the commencement of that disability and does not include anyinvestment income or any other income not derived from the insured's vocationalactivities;
(ii) 'Overinsurance provision' includes this provision and anyother provision with respect to any loss-of-time coverage which may have theeffect of reducing an insurer's liability if the total amount of loss-of-timebenefits under all coverage exceeds a stated relationship to the insured'searnings."
(d) The provisions of subsections (a) through (c) of thissection may be included only in a policy providing a loss-of-time benefit whichis payable for at least fifty-two (52) weeks, which is issued on the basis ofselective underwriting of each individual application and for which theapplication includes a question designed to elicit information necessary eitherto determine the ratio of the total loss-of-time benefits of the insured to theinsured's earned income or to determine that the ratio does not exceed thepercentage of earnings, not less than sixty percent (60%), the insurer selectsand inserts instead of the blank factor specified in this section. As part ofthe proof of claim, the insurer may require the information necessary toadminister this provision. If the application indicates that other loss-of-timecoverage is to be discontinued, the amount of the other coverage shall beexcluded in computing the alternative percentage in the first sentence of theoverinsurance provision.
(e) The policy shall include a definition of "validloss-of-time coverage", which the commissioner approves as to form. Thedefinition may include:
(i) Coverage provided by:
(A) Governmental agencies; and
(B) Organizations subject to regulation by insurance law and byinsurance authorities of this or any other state of the United States or of anyother country or subdivision thereof.
(ii) Coverage provided for the insured pursuant to:
(A) Any disability benefits statute; or
(B) Any worker's compensation or employer's liability statute.
(iii) Benefits provided by labor-management trusteed plans, unionwelfare plans, employer or employee benefit organizations or by salarycontinuance or pension programs; and
(iv) Any other coverage the inclusion of which the commissionerapproves.
26-18-123. Unpaid premiums.
"UnpaidPremiums: Upon the payment of a claim under this policy, any premium then dueand unpaid or covered by any note or written order may be deducted from theamount of the claim paid."
26-18-124. Conformity with state statutes.
"Conformitywith State Statutes: Any provision of this policy which, on its effective date,is in conflict with the statutes of the state in which the insured resides onthat date is amended to conform to the minimum requirements of thosestatutes."
26-18-125. Illegal occupation.
"IllegalOccupation: The insurer is not liable for any loss to which a contributingcause is the insured's commission of or attempt to commit a felony or to whicha contributing cause is the insured's engaging in an illegal occupation."
26-18-126. Intoxicants and narcotics.
"Intoxicantsand Narcotics: The insurer is not liable for any loss sustained or contractedbecause of the insured's being intoxicated or under the influence of any narcoticunless administered on the advice of a physician."
26-18-127. Renewability.
(a) Disability insurance policies, other than accidentinsurance only policies, in which the insurer reserves the right to refuserenewal on an individual basis, shall provide in substance in a provision inthe policy or in an endorsement thereon or rider attached thereto that:
(i) Subject to the right to terminate the policy uponnonpayment of premium when due, the right to refuse renewal may not beexercised so as to take effect before the renewal date occurring on, or afterand nearest, each policy anniversary (or in the case of lapse andreinstatement, at the renewal date occurring on, or after and nearest, eachanniversary of the last reinstatement); and
(ii) Any refusal of renewal is without prejudice to any claimoriginating while the policy is in force.
(b) The insurer may omit the parenthetic reference to lapse andreinstatement in paragraph (a)(i) of this section.
26-18-128. Order of provisions of policy.
Theprovisions specified in W.S. 26-18-105 through 26-18-127 or any correspondingprovisions used instead of the provisions in those sections shall be printed inthe consecutive order of the provisions in W.S. 26-18-105 through 26-18-127 or,at the insurer's option, any such provision may appear as a unit in any part ofthe policy, with other provisions to which it is logically related, providedthat the resulting policy shall not be in any part unintelligible, ambiguous orlikely to mislead a person to whom the policy is offered, delivered or issued.
26-18-129. Third-party ownership.
"Insured",as used in this chapter, shall not be construed as preventing a person, otherthan the insured, with a proper insurable interest from making application forand owning a policy covering the insured or from being entitled under thatpolicy to any indemnities, benefits and rights provided therein.
26-18-130. Requirements of other jurisdictions.
Anypolicy of a foreign or alien insurer, when delivered or issued for delivery toany person in this state, may contain any provision which is not less favorableto the insured or the beneficiary than the provisions of this chapter and whichis prescribed or required by the law of the state or country under which theinsurer is organized.
26-18-131. Policies issued for delivery in another state.
Ifany policy is issued by a domestic insurer for delivery to a person residing inanother state, and if the insurance commissioner or corresponding publicofficial of the other state informs the commissioner that the policy is notsubject to approval or disapproval by the official, the commissioner, byruling, may require that the policy meet the standards set forth in W.S.26-18-103 through 26-18-130.
26-18-132. Policies less favorable than provisions of chapterprohibited.
Anypolicy provision which is not subject to this chapter shall not make a policy,or any portion thereof, less favorable in any respect to the insured or thebeneficiary than the provisions of the policy which are subject to thischapter.
26-18-133. Age limit.
Ifa policy contains a provision establishing, as an age limit or otherwise, adate after which the coverage provided by the policy is not effective, and ifthat date falls within a period for which the insurer accepts a premium or ifthe insurer accepts a premium after that date, the coverage provided by thepolicy continues in force until the end of the period for which premium isaccepted. If the insured's age is misstated and if according to the insured'scorrect age the coverage provided by the policy would not be effective, orwould cease prior to the acceptance of the premium, the insurer's liability islimited to the refund, upon request, of all premiums paid for the period notcovered by the policy.
26-18-134. Prohibited policy plans and provisions.
(a) No insurer shall deliver or issue for delivery in thisstate any disability insurance policy:
(i) Providing benefits or values for surviving or continuingpolicyholders contingent upon the lapse or termination for any reason of otherpolicyholders policies;
(ii) Containing any clause, provision or agreement providing apremium, deposit or other payment for, or promising the distribution of, anybonus, special fund or guaranteed payment other than the insurance benefitsspecified in the policy, except that this restriction does not apply to thepayment of dividends to the holders of participating policies.
26-18-135. Filing of rates; adherence to rates filed.
Eachinsurer issuing disability insurance policies for delivery in this state,before use thereof, shall file with the commissioner its premium rates andclassification of risks pertaining to the policies. The insurer shall adhere toits rates and classifications as filed with the commissioner. The insurer maychange the filings as it deems proper.
26-18-136. Franchise disability insurance.
(a) Disability insurance on a franchise plan is that form ofdisability insurance issued to:
(i) Four (4) or more employees of any corporation,copartnership or individual employer or any governmental corporation, agency ordepartment thereof; or
(ii) Ten (10) or more members, employees or employees of membersof any labor union or of any trade, professional or other association which:
(A) Has a constitution or bylaws; and
(B) Repealed by Laws 2003, Ch. 160, 2.
(C) Issues to the persons specified in this paragraph, with orwithout their dependents, the same form of an individual policy varying only asto amounts and kinds of coverage applied for by those persons under anarrangement in which the premiums on the policies may be paid to the insurerperiodically by:
(I) The employer, with or without payroll deductions;
(II) The association or union for its members; or
(III) Some designated person acting on behalf of the employer,association or union.
(b) "Employees", as used in this section, includesthe officers, managers, employees and retired employees of the employer and theindividual proprietor or partners if the employer is an individual proprietoror partnership.
(c) Prior to marketing or offering any disability insurance fora franchise plan formed for the sole purpose of obtaining insurance, theproducer shall file a written report with the department setting forth the nameof the entity or entities, the insurer and its address and the offeringproducer and his address. The department shall keep the name of theassociation confidential.
(d) The provisions of the Small Employer Health Insurance AvailabilityAct, W.S. 26-19-301 et seq., shall apply to all insurance issued under thissection.
26-18-137. Repealed by Laws 1990, ch. 15, 3.
ARTICLE 2 - MULTI-STATE COOPERATION
26-18-201. Definitions.
(a) As used in this article:
(i) "Comprehensive individual medical and surgicalinsurance policy" shall have the same meaning as "health benefitplan" as that term is defined in W.S. 26-19-302(a)(xii), including, at aminimum, comprehensive major medical coverage for medical and surgicalbenefits;
(ii) "Health insurance," "health benefitplan" and "health benefit policy" mean a health benefit plan asdefined by W.S. 26-19-302(a)(xii);
(iii) "High deductible health plan" means accident andsickness insurance plans sold or maintained under the applicable provisions ofsection 223 of the Internal Revenue Code;
(iv) "Primary state" means the state designated by theissuer as the state whose covered laws shall govern the health insurance issuerin the sale of health insurance coverage;
(v) "Secondary state" means any state that is not theprimary state.
26-18-202. Sale of medical and surgical insurance policies approved inidentified other states.
In accordance with the provisions of thisarticle, the commissioner shall identify at least five (5) states withinsurance laws sufficiently consistent with Wyoming laws. The commissioner mayapprove for sale in Wyoming selected comprehensive individual medical andsurgical insurance policies that have been approved for issuance in those otherstates where the insurer is authorized to engage in the business of insuranceso long as the insurer is also authorized to engage in the business ofinsurance in this state and provided that the policy meets the requirements setforth in this article. High deductible health plans that meet nationalstandards for comprehensive medical and surgical coverage may be among thepolicies automatically approved in Wyoming if approved in the states identifiedas acceptable by the commissioner.
26-18-203. Approval of policies.
A policy approved and issued pursuant tothis article shall be treated as if it were issued by an insurer domiciled inWyoming regardless of the insurer's actual domiciliary.
26-18-204. Financial requirements; continuing compliance.
(a) Any insurer selling an insurance policy pursuant to thisarticle, and any plan approved under this article, shall satisfy actuarialstandards and insurer solvency requirements set forth by the NationalAssociation of Insurance Commissioners (NAIC) and adopted by regulationpromulgated by the commissioner or as otherwise prescribed by regulationpromulgated by the commissioner so long as the regulation is not inconsistentwith NAIC standards.
(b) Any policy sold in Wyoming under the coverage andadministrative laws and regulations of another state that are not covered by aguarantee association or similar association of that state shall be protectedunder the Wyoming Life and Health Insurance Guaranty Association Act underChapter 42 of this title.
(c) The commissioner shall have the authority to determinewhether an insurer satisfies the standards required by this section and shallnot approve a policy or plan that he finds not in compliance with this section.The commissioner shall have the authority to determine whether the policiessold pursuant to this article continue to satisfy the requirements set forth inthis section in the same manner as he does with an individual accident andsickness insurance policy approved pursuant to this code. The commissioner shallhave the authority to suspend or revoke new sales of out-of-state policies ifthe laws and regulations of those states are determined to egregiously harmWyoming residents. Upon suspension or revocation, the issuers of theout-of-state policies shall be required to notify in writing all affectedWyoming policyholders of the suspension or revocation determination by thecommissioner.
26-18-205. Multi-state consortium; reciprocity requirements.
(a) The commissioner shall explore with other insurance commissionersthe creation of a consortium of like-minded states that could establish rulesof reciprocity for the approval of comprehensive individual medical andsurgical health insurance policies among the participating states.
(b) The commissioner shall solicit the thoughts and report aconsensus, where one exists, of the other commissioners interested in creatinga consortium of like minded states in establishing rules of reciprocity for theapproval of health insurance policies. Issues to be considered include but arenot limited to:
(i) Whether the consortium should involve only high deductibleindividual policies, all comprehensive individual medical and surgical healthinsurance policies, both of these types of individual policies plus small grouppolicies or all health insurance policies;
(ii) Whether insurers should be free to price differently amongconsortium states dependent on local health care costs and market conditions;
(iii) Whether a policy approved in a primary state shall beautomatically available in all secondary states of the consortium, or availableat the option of the insurer;
(iv) In areas where an associated preferred provider network isabsent, whether sale of policies should be prohibited, disclaimers should berequired or the sale of policies should be regulated only by market forces andconditions;
(v) The adequacy for a multi-state consortium of existing statelaws on insurer financial solvency, guarantee funds and imposition andcollection of premium taxes;
(vi) The authority of a secondary state to deal with customercomplaints concerning a multi-state policy;
(vii) Whether and when an insurer selling a policy approved in aprimary state must notify the commissioner of a secondary state that theinsurer is marketing the policy in the secondary state;
(viii) Whether secondary state insurers, in order to sellcompetitive policies, may match any less restrictive primary state rulesgoverning policies sold in the secondary state, and whether disclaimers to warnpotential customers shall be required on policies and promotional materials inthe secondary state;
(ix) Whether any of the issues identified in this subsectionrequire the enactment of uniform laws in the consortium states;
(x) Estimated savings to customers from policy approval only inthe primary state and from uniform or less restrictive policies across theconsortium states;
(xi) Other issues deemed appropriate by the commissioners toimplement a multi-state consortium.
(c) The commissioner shall make an initial proposal thatWyoming recommends the rules of approval for reciprocity should include termsand conditions to protect customers similar to the following:
(i) An issuer, with respect to a particular policy, may onlydesignate one (1) state as its primary state with respect to all coverage itoffers using that policy. An issuer may not change the designated primary statewith respect to individual health insurance coverage once the policy is issued;provided, however, that a change in designation may be made upon renewal of thepolicy with approval of the policyholder. With respect to the designatedprimary state, the issuer shall be licensed and approved to be doing businessin that state;
(ii) In the case of a health insurance issuer that is selling apolicy in, or to a resident of, a secondary state, the issuer shall be licensedand approved to be doing business in that secondary state; and
(iii) The covered laws of the primary state shall apply toindividual health insurance coverage offered by a health insurance issuer inthe primary state and policies sold in any secondary state. The coverage andissuer shall comply with these terms and conditions with respect to theoffering of coverage in Wyoming.
(d) Except as provided in this section, a health insuranceissuer with respect to its offer, sale, rating (including medicalunderwriting), benefit payment requirements, renewal and issuance ofcomprehensive individual medical and surgical health insurance coverage inWyoming is exempt from any covered laws of Wyoming as the secondary state andany rules, regulations, agreements or orders sought or issued by thecommissioner under or related to the covered laws to the extent that the lawswould:
(i) Make unlawful or regulate, directly or indirectly, theoperation of the health insurance issuer operating in Wyoming as a secondarystate, except that the commissioner may require an issuer:
(A) To pay on a nondiscriminatory basis applicable premium andother taxes, including high risk pool assessments and other assessments whichare levied on insurers and surplus lines insurers, brokers or policyholdersunder the laws of Wyoming;
(B) To register with and designate the commissioner as itsagent solely for the purpose of receiving service of legal documents orprocess;
(C) To submit to examinations of its financial condition inaccordance with the policies and regulations established through the nationalassociation of insurance commissioners for accreditation of states to performthese examinations;
(D) To comply with an injunction issued by a court of competentjurisdiction, upon a petition by the commissioner acting pursuant to chapters28 of this code, chapter 48 of this code or W.S. 26-34-122 or 26-34-123;
(E) To participate, on a nondiscriminatory basis, in anyinsurance insolvency guaranty association or similar association to which ahealth insurance issuer in the state is required to belong;
(F) To comply with any state law regarding fraud and abuse,except that if the state seeks an injunction regarding the conduct described inthis subparagraph, the injunction shall be obtained from a court of competentjurisdiction;
(G) To comply with any state law regarding unfair claimssettlement practices; and
(H) To comply with the applicable requirements for externalreview procedures with respect to coverage offered in the state.
(ii) Discriminate against the issuer issuing insurance in boththe primary state and in any secondary state.
(e) Nothing in this section shall be construed to prohibit ahealth insurance issuer:
(i) From terminating or discontinuing coverage or a class ofcoverage in accordance with the laws of the primary state;
(ii) From reinstating lapsed coverage; or
(iii) From retroactively adjusting the rates charged an insuredindividual if the initial rates were set based on material misrepresentation bythe individual at the time of issue.
(f) A health insurance issuer may not offer for sale individualhealth insurance coverage in Wyoming unless that coverage is currently offeredfor sale in the primary state.
(g) A person acting, or offering to act, as an agent or brokerfor a health insurance issuer with respect to the offering of individual healthinsurance coverage shall obtain a license from Wyoming, with commissions orother compensation subject to the provisions of the laws of Wyoming, exceptthat Wyoming may not impose any qualification or requirement whichdiscriminates against a nonresident agent or broker.
(h) Each health insurance issuer issuing individual healthinsurance coverage in both primary and secondary states shall submit to theinsurance commissioner of each state in which it intends to offer the coveragebefore it may offer individual health insurance coverage in the state:
(i) A copy of the plan of operation or feasibility study or anysimilar statement of the policy being offered and its coverage which shallinclude the name of its primary state and its principal place of business;
(ii) Written notice of any change in its designation of itsprimary state; and
(iii) Written notice from the issuer of the issuer's compliancewith all the laws of the primary state.
(j) Nothing in this section shall be construed to affect theauthority of any federal or state court to enjoin the solicitation or sale ofindividual health insurance coverage by a health insurance issuer to any personor group who is not eligible for that insurance.
(k) Out-of-state companies offering health benefit plans underthis article shall be subject to regulation by the commissioner with regard toenforcement of the contractual benefits under the health benefit plan,including the requirements regarding prompt payment of claims for benefitspursuant to W.S. 26-13-124 and 26-15-124.
26-18-206. Rules and regulations.
(a) The commissioner shall draft rules and regulationsnecessary to implement this article but shall be under no obligation to draftrules and regulations until after March 15, 2011. The commissioner may adoptthe rules provided they are consistent with the requirements of W.S. 26-18-206.
(b) Any dispute resolution mechanism or provision for noticeand hearing in this title shall apply to insurers issuing and delivering planspursuant to this article.
26-18-207. Conflict with other code provisions.
If the provisions of this article conflictwith any other provision of this code, the provisions of this article shallcontrol.
26-18-208. Authorization date.
No policy shall be issued or delivered forissuance in this state pursuant to the provisions of this article before July1, 2011.