11 NCAC 12 .1023             INCONTESTABILITY PERIOD

(a)  For a policy that has been in force for less than six months, an insurer may rescind the policy or deny an otherwise valid long-term care insurance claim upon a showing of misrepresentation by the insured that is material to the acceptance for coverage.

(b)  For a policy that has been in force for at least six months but less than two years, an insurer may rescind the policy or deny an otherwise valid long-term care insurance claim upon a showing of misrepresentation by the insured that is both material to the acceptance for coverage and that pertains to the condition for which benefits are sought.

(c)  After a policy has been in force for two years, the policy is not contestable upon the grounds of misrepresentation alone; that policy may be contested only upon a showing that the insured knowingly and intentionally misrepresented relevant facts relating to the insured's health.

(d)  No policy may be field issued based on medical or health status.  For purposes of this Paragraph, "field issued" means a policy or certificate issued by an agent or a third-party administrator pursuant to the underwriting authority granted to the agent or third party administrator by an insurer.

(e)  If an insurer has paid benefits under a policy, the benefit payments may not be recovered by the insurer if the policy is rescinded.

 

History Note:        Authority G.S. 58-2-40(1); 58-55-30(a);

Eff. December 1, 1994.