BILL REQ. #:  H-4050.1 

READ FIRST TIME 02/05/14.   

     AN ACT Relating to long-term care insurance price transparency; adding a new section to chapter 48.83 RCW; adding a new section to chapter 48.84 RCW; and creating a new section.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION.  Sec. 1   The legislature finds that persons purchasing long-term care insurance typically pay premiums for many years before receiving coverage for benefits offered under the policy. While maintaining the policy, many consumers are faced with increases in premiums that are surprising and may impact the consumer's ability to maintain the policy. The legislature finds that many older policies may not provide adequate consumer protection and notifications on premium increases and the options that may be available for consumers, and where possible these consumer protections should be added to the contract terms retroactively as well as prospectively.

NEW SECTION.  Sec. 2   A new section is added to chapter 48.83 RCW to read as follows:
     The issuer must provide notice of an upcoming premium rate schedule increase to all policyholders or certificate holders, as applicable, at least forty-five days prior to the implementation of any premium rate schedule increase by the issuer. At a minimum, the notice must include the following information:
     (1) An explanation of the potential premium rate revisions, and the policyholder's or certificate holder's options in the event of a premium rate revision;
     (2) A general explanation for applying a premium rate or rate schedule including a description of when the premium rate or rate schedule adjustments will be effective, such as the next anniversary date or next billing date;
     (3) Information regarding each premium rate increase on the policy form or similar policy forms over the past ten years for this state or any other state that, at a minimum, identifies the policy forms for which premium rates have been increased, the calendar years when the form was available for purchase, and the amount or percent of each increase. The issuer, in a fair manner, may provide additional explanatory information related to the rate increases; and
     (4) Contact information for the issuer, including a web site or phone number, for more information on the increase and the policyholder's or certificate holder's options.

NEW SECTION.  Sec. 3   A new section is added to chapter 48.84 RCW to read as follows:
     (1) The purpose of this section is to provide policyholders or certificate holders additional information on premium rate changes. This section applies to long-term care insurance policies, contracts, or riders delivered or issued for delivery in this state before January 1, 2009.
     (2) The issuer must provide notice of an upcoming premium rate schedule increase to all policyholders or certificate holders, as applicable, at least forty-five days prior to the implementation of any premium rate schedule increase by the issuer. At a minimum, the notice must include the following information:
     (a) An explanation of the potential premium rate revisions, and the policyholder's or certificate holder's options in the event of a premium rate revision;
     (b) A general explanation for applying a premium rate or rate schedule including a description of when the premium rate or rate schedule adjustments will be effective, such as the next anniversary date or next billing date;
     (c) Information regarding each premium rate increase on the policy form or similar policy forms over the past ten years for this state or any other state that, at a minimum, identifies the policy forms for which premium rates have been increased, the calendar years when the form was available for purchase, and the amount or percent of each increase. The issuer, in a fair manner, may provide additional explanatory information related to the rate increases; and
     (d) Contact information for the issuer, including a web site or phone number, for more information on the increase and the policyholder's or certificate holder's options.