Section 4: Incontestability period
Section 4. (a) For a policy or certificate that has been in force for less than 6 months, an insurer may rescind a long-term care insurance policy or certificate or deny an otherwise valid long-term care insurance claim upon a showing of misrepresentation that is material to the acceptance for coverage.
(b) For a policy or certificate that has been in force for at least 6 months but less than 2 years an insurer may rescind a long-term care insurance policy or certificate or deny an otherwise valid long-term care insurance claim upon a showing of misrepresentation that is both material to the acceptance for coverage and which pertains to the condition for which benefits are sought.
(c) After a policy or certificate has been in force for 2 years it shall not be contestable upon the grounds of misrepresentation alone but may be contested only upon a showing that the insured knowingly and intentionally misrepresented relevant facts relating to the insured's health.
(d) A long-term care insurance policy or certificate may be field issued if the compensation to the field issuer is not based on the number of policies or certificates issued. For the purposes of this subsection, the term ''field issued'' shall mean a policy or certificate issued by a producer or a third-party administrator under the underwriting authority granted to the producer or third party administrator by an insurer and using the insurer's underwriting guidelines.
(e) If an insurer has paid benefits under a long-term care insurance policy or certificate, the insurer shall not be entitled to recover the benefit payments if the policy or certificate is rescinded.
(f) In the event of the death of the insured, this section shall not apply to the remaining death benefit of a life insurance policy that accelerates benefits for long-term care. In that event, the remaining death benefits under any such policy shall be governed by section 132 of chapter 175. In any other event, this section shall apply to life insurance policies that accelerate benefits for long-term care.