40-2,112.Adverse underwriting decisions; reasons required to befurnished; refunds of premiums; time for making decision.(a) In the event of an adverse underwriting decision the insurance company,health maintenance organizationor agent responsible for the decision shall either provide the applicant,policyholder or individual proposed for coverage with the specific reasonor reasons for the adverse underwriting decision in writing or advise suchpersons that upon written request they may receive the specific reason orreasons in writing.
(b) Upon receipt of a written request within 60 business days from thedate of the mailing of notice or other communication of an adverse underwritingdecision to an applicant, policyholder or individual proposed for coverage,the insurance company, health maintenance organization or agent shallfurnish to such person within 21 businessdays of the receipt of such written request:
(1) The specific reason or reasons for the adverse underwriting decision,in writing, if such information was not initially furnished in writing pursuantto subsection (a); or
(2) if specific items of medical-record information are supplied by ahealth care institution or health care provider it shall be disclosed eitherdirectly to the individual about whom the information relates or to a healthcare provider designated by the individual and licensed to provide healthcare with respect to the condition to which the information relates, whicheverthe insurance company, health maintenance organization or agent prefers; and
(3) the names and addresses of the institutional sources that suppliedthe specific items of information given pursuant to subsection (b)(2) ifthe identity of any health care provider or health care institution isdisclosedeither directly to the individual or to the designated health care provider,whichever the insurance company, health maintenance organization or agentprefers.
(c) The obligations imposed by this section upon an insurance company,health maintenance organizationor agent may be satisfied by another insurance company, health maintenanceorganization or agent authorizedto act on its behalf.
(d) The company, health maintenance organization or the agent, whicheveris in possession of the money,shall refund to the applicant or individual proposed for coverage, thedifference between the payment and the earned premium, if any, in the eventof a declination of insurance coverage, termination of insurance coverage,or any other adverse underwriting decision.
(1) If coverage is in effect, such refund shall accompany the notice of theadverse underwriting decision, except such refund obligation shall not applyif:
(A) Material underwriting information requested by the application forcoverage is clearly misstated or omitted and the company or healthmaintenance organization attempts toprovide coverage based on the proper underwriting information; or
(B) the company or health maintenance organization includes with thenotice of the adverse underwritingdecision an offer of coverage to an applicant for life insurance under adifferent policy or at an increased premium. If such a counter-offer ismade by the insurer, the insured or the insured's legal representativeshall have 10 business days after receipt thereof in which to notify thecompany or health maintenance organization of acceptance of thecounter-offer, during which time coverage will bedeemed to be in effect under the terms of the policy for which application hasbeen made, but such coverage shall not extend beyond 30 calendar days followingthe date of issuance of the counter-offer by the insurancecompany or health maintenance organization. The insurancecompany or health maintenance organization shallpromptly refund the premium upon notice of the insured's refusal to accept thecounter-offer or upon expiration of such 30 calendar day period, whicheveroccurs first.
(2) If coverage is not in effect and payment therefor is in thepossession of the company, health maintenance organization or the agent,the underwriting decision shall bemade within 20 business days from receipt of the application by the agentunless the underwriting decision is dependent upon substantive informationavailable only from an independent source. In such cases, the underwritingdecision shall be made within 10 business days from receipt of the externalinformation by the party that makes the decision. The refund shall accompanythe notice of an adverse underwriting decision.
History: L. 1981, ch. 190, § 2; L. 1989, ch. 140, § 1; L. 1990,ch. 163, § 1;L. 1994, ch. 355, § 1; May 19.
40-2,112.Adverse underwriting decisions; reasons required to befurnished; refunds of premiums; time for making decision.(a) In the event of an adverse underwriting decision the insurance company,health maintenance organizationor agent responsible for the decision shall either provide the applicant,policyholder or individual proposed for coverage with the specific reasonor reasons for the adverse underwriting decision in writing or advise suchpersons that upon written request they may receive the specific reason orreasons in writing.
(b) Upon receipt of a written request within 60 business days from thedate of the mailing of notice or other communication of an adverse underwritingdecision to an applicant, policyholder or individual proposed for coverage,the insurance company, health maintenance organization or agent shallfurnish to such person within 21 businessdays of the receipt of such written request:
(1) The specific reason or reasons for the adverse underwriting decision,in writing, if such information was not initially furnished in writing pursuantto subsection (a); or
(2) if specific items of medical-record information are supplied by ahealth care institution or health care provider it shall be disclosed eitherdirectly to the individual about whom the information relates or to a healthcare provider designated by the individual and licensed to provide healthcare with respect to the condition to which the information relates, whicheverthe insurance company, health maintenance organization or agent prefers; and
(3) the names and addresses of the institutional sources that suppliedthe specific items of information given pursuant to subsection (b)(2) ifthe identity of any health care provider or health care institution isdisclosedeither directly to the individual or to the designated health care provider,whichever the insurance company, health maintenance organization or agentprefers.
(c) The obligations imposed by this section upon an insurance company,health maintenance organizationor agent may be satisfied by another insurance company, health maintenanceorganization or agent authorizedto act on its behalf.
(d) The company, health maintenance organization or the agent, whicheveris in possession of the money,shall refund to the applicant or individual proposed for coverage, thedifference between the payment and the earned premium, if any, in the eventof a declination of insurance coverage, termination of insurance coverage,or any other adverse underwriting decision.
(1) If coverage is in effect, such refund shall accompany the notice of theadverse underwriting decision, except such refund obligation shall not applyif:
(A) Material underwriting information requested by the application forcoverage is clearly misstated or omitted and the company or healthmaintenance organization attempts toprovide coverage based on the proper underwriting information; or
(B) the company or health maintenance organization includes with thenotice of the adverse underwritingdecision an offer of coverage to an applicant for life insurance under adifferent policy or at an increased premium. If such a counter-offer ismade by the insurer, the insured or the insured's legal representativeshall have 10 business days after receipt thereof in which to notify thecompany or health maintenance organization of acceptance of thecounter-offer, during which time coverage will bedeemed to be in effect under the terms of the policy for which application hasbeen made, but such coverage shall not extend beyond 30 calendar days followingthe date of issuance of the counter-offer by the insurancecompany or health maintenance organization. The insurancecompany or health maintenance organization shallpromptly refund the premium upon notice of the insured's refusal to accept thecounter-offer or upon expiration of such 30 calendar day period, whicheveroccurs first.
(2) If coverage is not in effect and payment therefor is in thepossession of the company, health maintenance organization or the agent,the underwriting decision shall bemade within 20 business days from receipt of the application by the agentunless the underwriting decision is dependent upon substantive informationavailable only from an independent source. In such cases, the underwritingdecision shall be made within 10 business days from receipt of the externalinformation by the party that makes the decision. The refund shall accompanythe notice of an adverse underwriting decision.
History: L. 1981, ch. 190, § 2; L. 1989, ch. 140, § 1; L. 1990,ch. 163, § 1;L. 1994, ch. 355, § 1; May 19.
40-2,112.Adverse underwriting decisions; reasons required to befurnished; refunds of premiums; time for making decision.(a) In the event of an adverse underwriting decision the insurance company,health maintenance organizationor agent responsible for the decision shall either provide the applicant,policyholder or individual proposed for coverage with the specific reasonor reasons for the adverse underwriting decision in writing or advise suchpersons that upon written request they may receive the specific reason orreasons in writing.
(b) Upon receipt of a written request within 60 business days from thedate of the mailing of notice or other communication of an adverse underwritingdecision to an applicant, policyholder or individual proposed for coverage,the insurance company, health maintenance organization or agent shallfurnish to such person within 21 businessdays of the receipt of such written request:
(1) The specific reason or reasons for the adverse underwriting decision,in writing, if such information was not initially furnished in writing pursuantto subsection (a); or
(2) if specific items of medical-record information are supplied by ahealth care institution or health care provider it shall be disclosed eitherdirectly to the individual about whom the information relates or to a healthcare provider designated by the individual and licensed to provide healthcare with respect to the condition to which the information relates, whicheverthe insurance company, health maintenance organization or agent prefers; and
(3) the names and addresses of the institutional sources that suppliedthe specific items of information given pursuant to subsection (b)(2) ifthe identity of any health care provider or health care institution isdisclosedeither directly to the individual or to the designated health care provider,whichever the insurance company, health maintenance organization or agentprefers.
(c) The obligations imposed by this section upon an insurance company,health maintenance organizationor agent may be satisfied by another insurance company, health maintenanceorganization or agent authorizedto act on its behalf.
(d) The company, health maintenance organization or the agent, whicheveris in possession of the money,shall refund to the applicant or individual proposed for coverage, thedifference between the payment and the earned premium, if any, in the eventof a declination of insurance coverage, termination of insurance coverage,or any other adverse underwriting decision.
(1) If coverage is in effect, such refund shall accompany the notice of theadverse underwriting decision, except such refund obligation shall not applyif:
(A) Material underwriting information requested by the application forcoverage is clearly misstated or omitted and the company or healthmaintenance organization attempts toprovide coverage based on the proper underwriting information; or
(B) the company or health maintenance organization includes with thenotice of the adverse underwritingdecision an offer of coverage to an applicant for life insurance under adifferent policy or at an increased premium. If such a counter-offer ismade by the insurer, the insured or the insured's legal representativeshall have 10 business days after receipt thereof in which to notify thecompany or health maintenance organization of acceptance of thecounter-offer, during which time coverage will bedeemed to be in effect under the terms of the policy for which application hasbeen made, but such coverage shall not extend beyond 30 calendar days followingthe date of issuance of the counter-offer by the insurancecompany or health maintenance organization. The insurancecompany or health maintenance organization shallpromptly refund the premium upon notice of the insured's refusal to accept thecounter-offer or upon expiration of such 30 calendar day period, whicheveroccurs first.
(2) If coverage is not in effect and payment therefor is in thepossession of the company, health maintenance organization or the agent,the underwriting decision shall bemade within 20 business days from receipt of the application by the agentunless the underwriting decision is dependent upon substantive informationavailable only from an independent source. In such cases, the underwritingdecision shall be made within 10 business days from receipt of the externalinformation by the party that makes the decision. The refund shall accompanythe notice of an adverse underwriting decision.
History: L. 1981, ch. 190, § 2; L. 1989, ch. 140, § 1; L. 1990,ch. 163, § 1;L. 1994, ch. 355, § 1; May 19.
