SECTION 3.3847. Qualified Long-Term Care Insurance Contracts: Prohibited Representations

(a) In marketing and issuing long-term care insurance contracts in Texas, no person shall state that any such contract is intended to be a "qualified long-term care insurance contract" as defined in §3.3804 of this title (relating to Definitions) unless the contract:

(1) provides insurance protection only for services which are "qualified long-term care services," as defined in §3.3804 of this title (relating to Definitions);

(2) does not provide for a cash surrender value or other money that can be paid, assigned or pledged as collateral for a loan or borrowed, except on a complete surrender or cancellation of the contract;

(3) provides that all refunds of premium and all policyholder dividends or similar amounts are applied as a reduction in future premiums or to increase future benefits, except for any refund on the death of the insured, or on a complete surrender or cancellation of the contract, which cannot exceed the aggregate premiums paid under the contract;

(4) does not pay or reimburse expenses incurred under Medicare or which would be reimbursable under Medicare but for the application of a deductible or coinsurance amount, except expenses which are reimbursable under Medicare only as a secondary payor; and

(5) otherwise meets the applicable requirements of this subchapter.

(b) Neither this section, nor any other provision of law, shall be construed or applied so as to prohibit the offering of a long-term care insurance contract on the basis that the contract coordinates its benefits with those provided under Medicare.

Source Note: The provisions of this §3.3847 adopted to be effective May 8, 1997, 22 TexReg 3786