Accelerated Benefits Model Regulation

What this document is

Accelerated Benefits Model Regulation is a naic model law published by National Association of Insurance Commissioners (NAIC). It is one of the documents that insurance license exam questions are written from, including life & health practice questions. This page summarizes it and points to the official version, which is the text to rely on.

Sections cited in practice questions

Each practice answer shows the exact passage it comes from. These are sections of this document that questions cite, with a short excerpt from the source text.

• NAIC Model NAIC 620: Section 10.B (Effect on Cash Value)

  “when an accelerated benefit is payable, there shall be no more than a pro rata reduction in the cash value based on the percentage of death benefits accelerated to produce the accelerated benefit payment.”

• NAIC Model NAIC 620: Section 2B(2) (Qualifying Event)

  “A medical condition that has required or requires extraordinary medical intervention, such as, but not limited to, major organ transplant or continuous artificial life support, without which the insured would die;”

• NAIC Model NAIC 620: Section 5.B (Restrictions on Use of Proceeds)

  “B. Restrictions on Use of Proceeds. No restrictions are permitted on the use of the proceeds.”

• NAIC Accelerated Benefits Model Regulation (#620) § 6C(1) and § 6C(1)(a), solicitation disclosure in agent solicited insurance

  “A written disclosure including, but not necessarily limited to, a brief description of the accelerated benefit and definitions of the conditions or occurrences triggering payment of the benefits shall be given to the applicant. The description shall include an explanation of any effect of the...”

• NAIC Accelerated Benefits Model Regulation (#620) § 6D, effect of the benefit payment statement

  “When a policyowner or certificateholder requests an acceleration, the insurer shall send a statement to the policyowner or certificateholder and irrevocable beneficiary showing any effect that the payment of the accelerated benefit will have on the policy’s cash value, accumulation account, death...”

• Accelerated Benefits Model Regulation § 6A (Disclosures, Descriptive Title)

  “A. Descriptive Title. The terminology “accelerated benefit” shall be included in the descriptive title. Products regulated under this regulation shall not be described or marketed as long-term care insurance or as providing long-term care benefits.”

• Accelerated Benefits Model Regulation § 6C(1)(b) (Solicitations, direct response methods)

  “(b) In the case of a solicitation by direct response methods, the insurer shall provide the disclosure form to the applicant at the time the policy is delivered, with a notice that a full premium refund shall be received if the policy is returned to the company within the free look period.”

• Accelerated Benefits Model Regulation § 6C(4) (Disclosure of Administrative Expense Charge)

  “(4) Disclosure of Administrative Expense Charge. The insurer shall disclose to the policyowner any administrative expense charge. The insurer shall make a reasonable effort to assure that the certificateholder is aware of any administrative expense charge if the certificateholder is required to pay the charge.”

• Accelerated Benefits Model Regulation § 7 (Effective Date of the Accelerated Benefits)

  “The accelerated benefit provision shall be effective for accidents on the effective date of the policy or rider. The accelerated benefit provision shall be effective for illness no more than thirty (30) days following the effective date of the policy or rider.”

• Accelerated Benefits Model Regulation § 9 (Discrimination)

  “An insurer shall not unfairly discriminate among insureds with differing qualifying events covered under the policy or among insureds with similar qualifying events covered under the policy. An insurer shall not apply further conditions on the payment of the accelerated benefits other than those...”

• Accelerated Benefits Model Regulation § 1 (Purpose)

  “The purpose of this regulation is to regulate accelerated benefit provisions of individual and group life insurance policies and to provide required standards of disclosure. This regulation shall apply to all accelerated benefits provisions of individual and group life insurance policies except...”

• Accelerated Benefits Model Regulation § 6C(1)(c) (Disclosures, Solicitations)

  “(c) In the case of group insurance policies, the disclosure form shall be contained as part of the certificate of coverage or any related document furnished by the insurer for the certificateholder.”

Practice this material

Questions about this source

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