SB 281 Summary

• Defines "accelerated death benefit" as a life insurance policy provision allowing advance payment of death proceeds when an insured experiences a qualifying event (terminal illness or chronic illness meeting specific criteria).

• Requires accelerated death benefit policies to include specific disclosures, free-look periods of 30 days, commissioner-approved forms, and prohibition on marketing as long-term care insurance.

• Limits long-term care insurance certification requirements to 90 days and prohibits insurers from causing policyholders to unnecessarily replace long-term care or life insurance policies with accelerated death benefit policies.

• Establishes requirements for accelerated death benefit payments including lump sum or periodic payment options, clear explanation of tax consequences under Internal Revenue Code Section 101(g), and monthly reporting to policyholders.

• Prohibits discrimination based on age or health deterioration and requires agents to distinguish accelerated death benefits from long-term care insurance; subjects non-compliant insurers to unfair trade practice penalties.