The Consumer Awareness Act of Future Premium Rates Exposed
The Consumer Awareness Act of Future Premium Rates for Long-Term Care is listed under ALEC's Health and Human Services Task Force and was included in the 1995 ALEC Sourcebook of American State Legislation. See also Long-Term Care Insurance Act. ALEC has attempted to distance itself from this piece of legislation after the launch of ALECexposed.org in 2011, but it has done nothing to get it repealed in the states where it previously pushed for it to be made into law.
ALEC Bill Text
Summary
This bill is to be introduced in conjunction with the Long-Term Care Insurance Act. Its purpose is to protect the consumer from unknowing increases in future premium rates when purchasing long-term care insurance policies.
ALEC's bill stipulates that all long-term care insurance policies must state that the policy premium rates may rise based on claims incurred by all policyholders. Any representation that the policyholder's rates will not rise is unauthorized and should not be relied upon.
Model Legislation
{Title, enacting clause, etc.}
Section 1.
This Act may be cited as The Consumer Awareness Act of Future Premium Rates For Long-Term Care Insurance.
Section 2.
For any Long Term Care insurance policy or certificate issued or delivered in this state that does not guarantee to a policyholder that the original premium rate will not increase over time, the following language or substantially similar language must be disclosed in bold ten-point type on the cover page of the policy or certificate:
"This policy has premium rates that may rise from time to time for all policyholders based on the claims incurred by all policyholders. Any representation that your rates will not rise is unauthorized and should not be relied upon. Limitations on future rate increases, if there are any, should be stated immediately below this disclosure."
Section 3. {Severability Clause}
Section 4. {Repealer Clause}
Section 5. {Effective Date}
1995 Sourcebook of American State Legislation
