| 16 | | - | Section 1. (Effective from passage) On or before January 1, 2012, the Legislative Program Review and Investigations Committee shall submit to the joint standing committee of the General Assembly having cognizance of matters relating to insurance a study of offsets contained in individual and group long-term disability income protection policies offered to residents of the state. Such study shall include, but not be limited to, an examination of (1) specific benefits for which such offsets limit payments to an insured, (2) the average percentage of income such policies cover and maximum dollar limits of such policies, (3) differences in costs to an insured for policies that contain an offset and comparable policies that do not contain an offset, (4) the potential impact on market penetration of any changes to offsets contained in long-term disability income protection policies, (5) the potential impact on state assistance programs, including, but not limited to, the Medicaid program and the state supplement program to the Supplemental Security Income Program of any changes to offsets contained in such policies, and (6) the financial impact on state employee benefits of any changes to offsets contained in such policies. |
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| 28 | + | Section 1. Section 38a-519 of the general statutes is repealed and the following is substituted in lieu thereof (Effective January 1, 2012): |
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| 29 | + | |
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| 30 | + | (a) No group health insurance policy that provides disability income protection coverage, delivered, issued for delivery, renewed, amended or continued in this state, and no application, rider or endorsement used in connection therewith shall contain an offset proviso. For the purposes of this subsection, [an] "offset proviso" means any provision of an insurance policy that allows the insurer to reduce its liability for loss or expense from sickness or from bodily injury of the insured by reason of any cost of living increase in other disability benefits that occur after the date a claim commences under such policy. |
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| 31 | + | |
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| 32 | + | (b) For each group long-term disability income protection coverage policy delivered, issued for delivery, renewed, amended or continued in this state, that contains an offset, the insurer shall disclose to a policyholder in a separate document and in a conspicuous manner in not less than fourteen-point bold face type: (1) That the policy contains an offset; (2) that such offset will function to limit payments to an insured under the policy, taking into account Social Security disability benefits and other benefits the insured may receive; (3) for what other categories of benefits the policy will offset; (4) the [per cent] percentage of income the policy covers and the maximum dollar limit of the policy, if applicable; and (5) at least one example showing how such offset will operate. Such disclosure shall include a statement that, if an eligible individual wants a policy that does not contain an offset, the individual may contact an insurance agent or company for an individual policy. |
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| 33 | + | |
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| 34 | + | (c) No policy set forth in subsection (b) of this section that contains an offset for disability benefits received by the insured under the Social Security Act, as amended from time to time, with respect to disabilities that occur after such delivery, issuance for delivery, renewal, amendment or continuance, shall include in such offset any disability benefits received under the Social Security Act, as amended from time to time, by any dependent child of the insured or received by such insured on behalf of such dependent child. |
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| 35 | + | |
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| 36 | + | [(c)] (d) The policyholder shall provide to each eligible individual the information and the statement required to be disclosed under subsection (b) of this section. |
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| 37 | + | |
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| 38 | + | Sec. 2. (NEW) (Effective January 1, 2012) (a) No individual health insurance policy that provides disability income protection coverage, delivered, issued for delivery, renewed, amended or continued in this state, and no application, rider or endorsement used in connection therewith shall contain an offset proviso. For the purposes of this subsection, "offset proviso" means any provision of an insurance policy that allows the insurer to reduce its liability for loss or expense from sickness or from bodily injury of the insured by reason of any cost of living increase in other disability benefits that occur after the date a claim commences under such policy. |
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| 39 | + | |
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| 40 | + | (b) For each individual long-term disability income protection coverage policy delivered, issued for delivery, renewed, amended or continued in this state, that contains an offset, the insurer shall disclose to the insured in a separate document and in a conspicuous manner in not less than fourteen-point bold face type: (1) That the policy contains an offset; (2) that such offset will function to limit payments to an insured under the policy, taking into account Social Security disability benefits and other benefits the insured may receive; (3) for what other categories of benefits the policy will offset; (4) the percentage of income the policy covers and the maximum dollar limit of the policy, if applicable; and (5) at least one example showing how such offset will operate. Such disclosure shall include a statement that, if an individual wants a policy that does not contain an offset, the individual may contact an insurance agent or company. |
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| 41 | + | |
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| 42 | + | (c) No policy set forth in subsection (b) of this section that contains an offset for disability benefits received by the insured under the Social Security Act, as amended from time to time, with respect to disabilities that occur after such delivery, issuance for delivery, renewal, amendment or continuance, shall include in such offset any disability benefits received under the Social Security Act, as amended from time to time, by any dependent child of the insured or received by such insured on behalf of such dependent child. |
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