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03 AAC 28.335. Standard Coverage (a) Standard coverage for credit life insurance is coverage that an insurer offers to all eligible debtors, without requiring or requesting evidence of individual insurability on or within 30 days before or after the date the debtor becomes eligible, and that contains the following provisions: (1) coverage for death by any cause, except that the insurer may exclude coverage for death resulting from (A) war, or an act of war; (B) suicide within 12 months after the effective date of the coverage; or (C) a preexisting condition for which the insured received medical advice, diagnosis, or treatment within six months before the effective date of the insured's coverage and that caused or contributed to the death of the insured within six months after the effective date of coverage; (2) for the exclusions listed under (1)(B) and (C) of this subsection, a provision setting the effective date of coverage for each part of the insurance attributable to a different advance or charge to the plan account as the date on which the advance or charge is posted to the plan account; (3) at the option of the insurer and instead of a preexisting condition exclusion on insurance written in connection with open-end consumer credit, a provision to limit the amount of insurance payable on death due to natural causes to the balance as it existed six months before the date of death if (A) at least one increase occurs in the outstanding balance during the six months before the date of death, other than an increase due to the accrual of interest or late charges; and (B) evidence of individual insurability is not required during the six months before the date of death; (4) an age restriction providing that credit life insurance will not become effective for a debtor on or after the attainment of age 66 and that all credit life insurance will terminate once a debtor reaches the age of 66. (b) Standard coverage for credit disability insurance is coverage that an insurer offers to all eligible debtors, without requiring or requesting evidence of individual insurability on or within 30 days before or after the date the debtor becomes eligible, and that (1) contains the following provisions: (A) coverage for disability by any cause, except that the insurer may exclude coverage for disabilities resulting from (i) a normal pregnancy; (ii) war or an act of war; (iii) elective surgery; (iv) intentionally self-inflicted injury; (v) sickness or injury caused by or resulting from the use of alcoholic beverages or narcotics, including hallucinogens, unless they are administered on the advice of a physician other than the debtor; (vi) flight in an aircraft other than a commercial scheduled aircraft; or (vii) a preexisting condition for which the insured received medical advice, diagnosis, or treatment within six months before the effective date of the insured's coverage and that caused a loss within the six months after the effective date of coverage; the effective date of coverage for each part of the insurance attributable to a different advance or charge to the plan account is the date on which the advance or charge is posted to the plan account; (B) a definition of disability providing that (i) for the first 12 months of disability, total disability is defined as the insured's inability to perform the essential functions of the insured's own occupation; and (ii) after the first 12 months of disability, total disability is defined as the insured's inability to perform the essential functions of any occupation for which the insured is reasonably suited by virtue of education, training, or experience; (C) an age restriction providing that credit disability insurance will not become effective for a debtor on or after the attainment of age 66 and that all credit disability insurance will terminate once a debtor reaches the age of 66; (D) a daily benefit of not less than one-thirtieth of the monthly benefit payable under the policy; and (2) does not contain an employment requirement more restrictive than one requiring that the debtor be employed and actively at work full-time on the effective date of coverage; for purposes of this paragraph, a debtor is (A) at work full-time if the debtor works a regular work week of not less than 30 hours; and (B) actively at work if absence from work is due solely to a regular day off, holiday, or paid vacation. (c) An application form for which any underwriting questions have been answered or filled in is evidence of individual insurability. An application form for which all underwriting questions have been left unanswered, and for which other evidence of underwriting questions being answered by the debtor does not exist, will be considered coverage offered without evidence of individual insurability for purposes of (a) and (b) of this section if coverage is issued based on the application. Authority: AS 21.06.090 AS 21.57.040 AS 21.57.050 AS 21.57.080 AS 21.57.130 |