Consumer Protections

Wisconsin law requires that insurance companies selling long-term care insurance policies provide you with specific information at the time you are considering the purchase of long-term care insurance. This information includes:

  • An outline of coverage. This is a summary of the policy that explains what it will cover and what it will not cover.
  • Company history of rate increases. The insurance company must disclose its past premium increases.
  • Personal Worksheet. You will be asked to complete a Personal Worksheet that can help determine your ability to pay premiums at the time of application and over time and your reasons for buying the insurance. Completing the Personal Worksheet will help you determine if long-term care is suitable for you. A copy of this worksheet is on pages 35 - 36 of the Guide to Long-Term Care.
  • Ability to designate a person (in addition to yourself) to receive notice of lapse or termination of the policy for nonpayment of premiums. As a protection against unintentional lapse, you have the right to designate another person, in addition to yourself, to receive a letter when your policy is about to lapse or terminate for nonpayment of premium.

After you apply for long-term care insurance, the policy you receive is required to provide the following consumer protections:

  • 30-day free-look period. Once you receive your insurance policy, you have 30 days to review it and, if you change your mind and want to return the policy, you will receive a full refund of the premiums you paid.
  • Contingent nonforfeiture benefit. Policies issued after January 1, 2002, must include a contingent benefit upon lapse requirement. The benefit will be triggered if your policy is subject to a substantial premium increase and you did not buy a shortened benefit nonforfeiture option. A contingent benefit upon lapse requirement will provide added protection to you in the event of lapse. For example, if you are 70 years old and you had rejected the insurance company's offer of a nonforfeiture benefit, and the premium rises to 40% more than the original premium you paid when you first bought the policy, you will be offered two options. The options are offered so you do not have to lapse the policy and lose your coverage. You will have the choice to (1) reduce your benefit amount and keep paying the original premium, or (2) convert the policy to paid-up status with a shorter benefit period and pay no more premiums. Of course, you may also choose to keep your policy and continue to pay the higher premium.
  • Benefit appeal procedure. You have the right under your long-term care insurance or life insurance long-term care policy to appeal a benefit denial. The benefit appeals internal procedure must be described in your policy.