Virginia Law

A. Every insurer, marketing long-term care insurance coverage in this Commonwealth directly or through its agents, shall:

1. Establish marketing procedures to assure that any comparison of policies by its agents will be fair and accurate.

2. Establish marketing procedures to assure excessive insurance is not sold or issued.

3. Display prominently by type, stamp or other appropriate means on the first page of the outline of coverage and policy the following:

"Notice to buyer: This policy may not cover all of the costs associated with long-term care incurred by the buyer during the period of coverage. The buyer is advised to review carefully all policy limitations."

4. Provide copies of the disclosure forms (Forms B and F) to the applicant.

5. Inquire and otherwise make every reasonable effort 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, except that in the case of qualified long-term care insurance contracts, an inquiry into whether a prospective applicant or enrollee for long-term care insurance has accident and sickness insurance is not required.

6. Every insurer, marketing long-term care insurance shall establish auditable procedures for verifying compliance with this subsection.

7. At solicitation, provide written notice to the prospective policyholder and certificateholder that the Virginia Insurance Counseling and Assistance Program is available at: Virginia Department for the Aging, 1610 Forest Avenue, Suite 100, Richmond, Virginia 23229, Aging Services Hotline 1-800-552-3402.

8. For long-term care health insurance policies and certificates, use the terms "noncancellable" or "level premium" only when the policy or certificate conforms with 14VAC5-200-60.

9. Provide an explanation of contingent benefit upon lapse provided for in 14VAC5-200-185 D 3 and, if applicable, the additional contingent benefit upon lapse provided to policies with fixed or limited premium paying periods in 14VAC5-200-185 D 4.

B. In addition to the practices prohibited in Chapter 5 (§ 38.2-500 et seq.) of Title 38.2 of the Code of Virginia, the following acts and practices are prohibited:

1. Twisting. Making any misleading representation or incomplete or fraudulent comparison 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.

C. 1. Associations that provide long-term care insurance policies or certificates endorsed or sold by the association shall disclose in any long-term care insurance solicitation:

a. The specific nature and amount of the compensation arrangements (including fees, commissions, administrative fees and other forms of financial support) that the association receives from endorsement or sale of the policy or certificate to its members; and

b. A brief description of the process under which the policies and the insurer issuing the policies were selected.

2. If the association and the insurer have interlocking directorates or trustee arrangements, the association shall disclose that fact to its members.

3. The board of directors of associations selling or endorsing long-term care insurance policies or certificates shall review and approve the insurance policies as well as the compensation arrangements made with the insurer.

4. A group long-term care insurance policy or certificate may not be issued to an association unless the insurer obtains the information contained in this subsection. The insurer may be required to provide such information to the commission upon request or certify that the association has complied with the requirements set forth in this subsection.