§ 27-8-5-3 — Required provisions; statutory option provisions; inapplicable or inconsistent provisions; order of provisions; third party ownership; requirements of other jurisdictions; filing procedure

Indiana § 27-8-5-3

• Jurisdiction: Indiana
• Title 27: INSURANCE
• Art. 8: LIFE, ACCIDENT, AND HEALTH
• Ch. 5: Accident and Sickness Insurance─Policy Provisions

Text

(a) Except as provided in subsection (c), each
policy delivered or issued for delivery to any person in this state shall
contain the provisions specified in this subsection in the words in
which the same appear in this section. However, the insurer may, at its
option, substitute for one (1) or more of the provisions corresponding
provisions of different wording approved by the commissioner that are
in each instance no less favorable in any respect to the insured or the
beneficiary. The provisions shall be preceded individually by the
caption appearing in this subsection or, at the option of the insurer, by
appropriate individual or group captions or subcaptions as the
commissioner may approve.
(1) A provision as follows: ENTIRE CONTRACT; CHANGES:
This policy, including the endorsements and the attached papers, if any,
constitutes the entire contract of insurance. No change in this policy
shall be valid until approved by an executive officer of the insurer and
unless such approval be endorsed hereon or attached hereto. No
insurance producer has authority to change this policy or to waive any
of its provisions.
(2) A provision as follows: TIME LIMIT ON CERTAIN
DEFENSES: (A) After two (2) years from the date of issue of this
policy no misstatements, except fraudulent misstatements, made by the
applicant in the application for such policy shall be used to void the
policy or to deny a claim for loss incurred or disability (as defined in
the policy) commencing after the expiration of such two (2) year
period.
The foregoing policy provision shall not be so construed as to affect
any legal requirement for avoidance of a policy of denial of a claim
during such initial two (2) year period, nor to limit the application of
subsection (b), (1), (2), (3), (4), and (5) in the event of misstatement
with respect to age or occupation or other insurance.
A policy which the insured has the right to continue in force subject
to its terms by the timely payment of premium:
(1) until at least age fifty (50); or
(2) in the case of a policy issued after forty-four (44) years of age,
for at least five (5) years from its date of issue;
may contain in lieu of the foregoing the following provision (from
which the clause in parentheses may be omitted at the insurer's option)
under the caption "INCONTESTABLE": After this policy has been in
force for a period of two (2) years during the lifetime of the insured
(excluding any period during which the insured is disabled), it shall
become incontestable as to the statements contained in the application.
(B) No claim for loss incurred or disability (as defined in the policy)
commencing after two (2) years from the date of issue of this policy
shall be reduced or denied on the ground that a disease or physical
condition, not excluded from coverage by name or specific description
effective on the date of loss, had existed prior to the effective date of
coverage of this policy.
(3) A provision as follows: GRACE PERIOD: A grace period of
(insert a number not less than "7" for weekly premium policies, "10"
for monthly premium policies and "31" for all other policies) days will
be granted for the payment of each premium falling due after the first
premium, during which grace period the policy shall continue in force.
A policy in which the insurer reserves the right to refuse renewal
shall have, at the beginning of the above provision: "Unless not less
than thirty (30) days prior to the premium due date the insurer has
delivered to the insured or has mailed to the insured's last address as
shown by the records of the insurer written notice of its intention not
to renew this policy beyond the period for which the premium has been
accepted.".
Each policy in which the insurer reserves the right to refuse renewal
on an individual basis shall provide, in substance, in a provision of the
policy, in an endorsement on the policy, or in a rider attached to the
policy, that subject to the right to terminate the policy upon
non-payment of premium when due, such right to refuse renewal shall
not be exercised before the renewal date occurring on, or after and
nearest, each anniversary, or in the case of lapse and reinstatement at
the renewal date occurring on, or after and nearest, each anniversary of
the last reinstatement, and that any refusal or renewal shall be without
prejudice to any claim originating while the policy is in force. The
preceding sentence shall not apply to accident insurance only policies.
(4) A provision as follows: REINSTATEMENT: If any renewal
premium is not paid within the time granted the insured for payment,
a subsequent acceptance of premium by the insurer or by any agent
authorized by the insurer to accept such premium, without requiring in
connection therewith an application for reinstatement, shall reinstate
the policy. Provided, that if the insurer or such agent requires an
application for reinstatement and issues a conditional receipt for the
premium tendered, the policy will be reinstated upon approval of such
application by the insurer or, lacking such approval, upon the forty-fifth
day following the date of such conditional receipt unless the insurer has
previously notified the insured in writing of its disapproval of such
application. The reinstated policy shall cover only loss resulting from
such accidental injury as may be sustained after the date of
reinstatement and loss due to such sickness as may begin more than ten
(10) days after such date. In all other respects the insured and insurer
shall have the same rights as they had under the policy immediately
before the due date of the defaulted premium, subject to any provisions
endorsed hereon or attached hereto in connection with the
reinstatement. Any premium accepted in connection with a
reinstatement shall be applied to a period for which premium has not
been previously paid, but not to any period more than sixty (60) days
prior to the date of reinstatement.
The last sentence of the above provision may be omitted from any
policy which the insured has the right to continue in force subject to its
terms by the timely payment of premiums:
(1) until at least fifty (50) years of age; or
(2) in the case of a policy issued after forty-four (44) years of age,
for at least five (5) years from its date of issue.
(5) A provision as follows: NOTICE OF CLAIM: Written notice of
claim must be given to the insurer within twenty (20) days after the
occurrence or commencement of any loss covered by the policy, or as
soon thereafter as is reasonably possible. Notice given by or on behalf
of the insured or the beneficiary to the insurer at _______ (insert the
location of such office as the insurer may designate for the purpose), or
to any authorized agent of the insurer, with information sufficient to
identify the insured, shall be deemed notice to the insurer.
In a policy providing a loss-of-time benefit which may be payable
for at least two (2) years, an insurer may insert the following between
the first and second sentences of the above provision:
Subject to the qualifications set forth below, if the insured suffers
loss of time on account of disability for which indemnity may be
payable for at least two (2) years, the insured shall, at least once in
every six (6) months after having given notice of claim, give to the
insurer notice of continuance of said disability, except in the event of
legal incapacity. The period of six (6) months following any filing of
proof by the insured or any payment by the insurer on account of such
claim or any denial of liability in whole or in part by the insurer shall
be excluded in applying this provision. Delay in the giving of such
notice shall not impair the insurer's right to any indemnity which would
otherwise have accrued during the period of six (6) months preceding
the date on which such notice is actually given.
(6) A provision as follows: CLAIM FORMS: The insurer, upon
receipt of a notice of claim, will furnish to the claimant such forms as
are usually furnished by it for filing proofs of loss. If such forms are not
furnished within fifteen (15) days after the giving of such notice, the
claimant shall be deemed to have complied with the requirements of
this policy as to proof of loss upon submitting, within the time fixed in
the policy for filing proofs of loss, written proof covering the
occurrence, the character, and the extent of the loss for which claim is
made.
(7) A provision as follows: PROOFS OF LOSS: Written proof of
loss must be furnished to the insurer at its said office in case of claim
for loss for which this policy provides any periodic payment contingent
upon continuing loss within ninety (90) days after the termination of
the period for which the insurer is liable and in case of claim for any
other loss within ninety (90) days after the date of such loss. Failure to
furnish such proof within the time required shall not invalidate nor
reduce any claim if it was not reasonably possible to give proof within
such time, provided such proof is furnished as soon as reasonably
possible and in no event, except in the absence of legal capacity, later
than one (1) year from the time proof is otherwise required.
(8) A provision as follows: TIME OF PAYMENT OF CLAIMS:
Indemnities payable under this policy for any loss other than loss for
which this policy provides any periodic payment will be paid:
(1) immediately upon receipt of due written proof of such loss; or
(2) in accordance with IC 27-8-5.7;
whichever is more favorable to the policyholder. Subject to due written
proof of loss, all accrued indemnities for loss for which this policy
provides periodic payment will be paid _______ (insert period for
payment which must not be less frequently than monthly) and any
balance remaining unpaid upon the termination of liability will be paid
immediately upon receipt of due written proof. This provision must
reflect compliance with IC 27-8-5.7.
(9) A provision as follows: PAYMENT OF CLAIMS: Indemnity for
loss of life will be payable in accordance with the beneficiary
designation and the provisions respecting such payment which may be
prescribed herein and effective at the time of payment. If no such
designation or provision is then effective, such indemnity shall be
payable to the estate of the insured. Any other accrued indemnities
unpaid at the insured's death may, at the option of the insurer, be paid
either to such beneficiary or to such estate. All other indemnities will
be payable to the insured.
The following provisions, or either of them, may be included with
the foregoing provision at the option of the insurer:
If any indemnity of this policy shall be payable to the estate of the
insured, or to an insured or beneficiary who is a minor or otherwise not
competent to give a valid release, the insurer may pay such indemnity,
up to an amount not exceeding $ _______ (insert an amount which
shall not exceed $1,000), to any relative by blood or connection by
marriage of the insured or beneficiary who is deemed by the insurer to
be equitably entitled thereto. Any payment made by the insurer in good
faith pursuant to this provision shall fully discharge the insurer to the
extent of such payment.
Subject to any written direction of the insured in the application or
otherwise all or a portion of any indemnities provided by this policy on
account of hospital, nursing, medical, or surgical services may, at the
insurer's option and unless the insured requests otherwise in writing not
later than the time of filing proofs of such loss, be paid directly to the
hospital or person rendering such services; but it is not required that the
service be rendered by a particular hospital or person.
For the purposes of this section a "minor" is a person under the age
of eighteen (18) years. A person eighteen (18) years of age or over is
competent, insofar as the person's age is concerned, to sign a valid
release.
(10) A provision as follows: PHYSICAL EXAMINATIONS AND
AUTOPSY: The insurer at its own expense shall have the right and
opportunity to examine the person of the insured when and as often as
it may reasonably require during the pendency of a claim hereunder
and to make an autopsy in case of death where it is not forbidden by
law.
(11) A provision as follows: LEGAL ACTIONS: No action at law
or in equity shall be brought to recover on this policy prior to the
expiration of sixty (60) days after written proof of loss has been
furnished in accordance with the requirements of this policy. No such
action shall be brought after the expiration of three (3) years after the
time written proof of loss is required to be furnished.
(12) A provision as follows: CHANGE OF BENEFICIARY: Unless
the insured makes an irrevocable designation of beneficiary, the right
to change of beneficiary is reserved to the insured and the consent of
the beneficiary or beneficiaries shall not be requisite to surrender or
assignment of this policy or to any change of beneficiary or
beneficiaries, or to any other changes in this policy.
The first clause of this provision, relating to the irrevocable
designation of beneficiary, may be omitted at the insurer's option.
(13) A provision as follows: GUARANTEED RENEWABILITY:
In compliance with the federal Health Insurance Portability and
Accountability Act of 1996 (P.L.104-191), renewability is guaranteed.
(b) Except as provided in subsection (c), no policy delivered or
issued for delivery to any person in Indiana shall contain provisions
respecting the matters set forth below unless the provisions are in the
words in which the provisions appear in this section. However, the
insurer may use, instead of any provision, a corresponding provision of
different wording approved by the commissioner which is not less
favorable in any respect to the insured or the beneficiary. Any
substitute provision contained in the policy shall be preceded
individually by the appropriate caption appearing in this subsection or,
at the option of the insurer, by appropriate individual or group captions
or subcaptions as the commissioner may approve.
(1) A provision as follows: CHANGE OF OCCUPATION: If the
insured be injured or contract sickness after having changed the
insured's occupation to one classified by the insurer as more hazardous
than that stated in this policy or while doing for compensation anything
pertaining to an occupation so classified, the insurer will pay only such
portion of the indemnities provided in this policy as the premium paid
would have purchased at the rates and within the limits fixed by the
insurer for such more hazardous occupation. If the insured changes the
insured's occupation to one classified by the insurer as less hazardous
than that stated in this policy, the insurer, upon receipt of proof of such
change of occupation, will reduce the premium rate accordingly, and
will return the excess pro rata unearned premium from the date of
change of occupation or from the policy anniversary date immediately
preceding receipt of such proof, whichever is the more recent. In
applying this provision, the classification of occupational risk and the
premium rates shall be such as have been last filed by the insurer prior
to the occurrence of the loss for which the insurer is liable or prior to
date of proof of change in occupation with the state official having
supervision of insurance in the state where the insured resided at the
time this policy was issued; but if such filing was not required, then the
classification of occupational risk and the premium rates shall be those
last made effective by the insurer in such state prior to the occurrence
of the loss or prior to the date of proof of change in occupation.
(2) A provision as follows: MISSTATEMENT OF AGE: If the age
of the insured has been misstated, all amounts payable under this policy
shall be such as the premium paid would have purchased at the correct
age.
(3) A provision as follows: OTHER INSURANCE IN THIS
INSURER: If an accident or sickness or accident and sickness policy
or policies previously issued by the insurer to the insured are in force
concurrently herewith, making the aggregate indemnity for _______
(insert type of coverage or coverages) in excess of $ _______ (insert
maximum limit of indemnity or indemnities) the excess insurance shall
be void and all premiums paid for such excess shall be returned to the
insured or to the insured's estate. Or, instead of that provision:
Insurance effective at any one (1) time on the insured under a like
policy or policies, in this insurer is limited to the one (1) such policy
elected by the insured, the insured's beneficiary or the insured's estate,
as the case may be, and the insurer will return all premiums paid for all
other such policies.
(4) A provision as follows: INSURANCE WITH OTHER
INSURER: If there is other valid coverage, not with this insurer,
providing benefits for the same loss on a provision of service basis or
on an expense incurred basis and of which this insurer has not been
given written notice prior to the occurrence or commencement of loss,
the only liability under any expense incurred coverage of this policy
shall be for such proportion of the loss as the amount which would
otherwise have been payable hereunder plus the total of the like
amounts under all such other valid coverages for the same loss of
which this insurer had notice bears to the total like amounts under all
valid coverages for such loss, and for the return of such portion of the
premiums paid as shall exceed the pro-rata portion of the amount so
determined. For the purpose of applying this provision when other
coverage is on a provision of service basis, the "like amount" of such
other coverage shall be taken as the amount which the services
rendered would have cost in the absence of such coverage.
If the foregoing policy provision is included in a policy which also
contains the next following policy provision there shall be added to the
caption of the foregoing provision the phrase "EXPENSE INCURRED
BENEFITS". The insurer may, at its option, include in this provision
a definition of "other valid coverage," approved as to form by the
commissioner, which definition shall be limited in subject matter to
coverage provided by organizations subject to regulation by insurance
law or by insurance authorities of this or any other state of the United
States or any province of Canada, and by hospital or medical service
organizations, and to any other coverage the inclusion of which may be
approved by the commissioner. In the absence of such definition such
term shall not include group insurance, automobile medical payments
insurance, or coverage provided by hospital or medical service
organizations or by union welfare plans or employer or employee
benefit organizations. For the purpose of applying the foregoing policy
provision with respect to any insured, any amount of benefit provided
for such insured pursuant to any compulsory benefit statute (including
any worker's compensation or employer's liability statute) whether
provided by a governmental agency or otherwise shall in all cases be
deemed to be "other valid coverage" of which the insurer has had
notice. In applying the foregoing policy provision no third party
liability coverage shall be included as "other valid coverage".
(5) A provision as follows: INSURANCE WITH OTHER
INSURERS: If there is other valid coverage, not with this insurer,
providing benefits for the same loss on other than an expense incurred
basis and of which this insurer has not been given written notice prior
to the occurrence or commencement of loss, the only liability for such
benefits under this policy shall be for such proportion of the
indemnities otherwise provided hereunder for such loss as the like
indemnities of which the insurer had notice (including the indemnities
under this policy) bear to the total amount of all like indemnities for
such loss, and for the return of such portion of the premium paid as
shall exceed the pro-rata portion for the indemnities thus determined.
If the foregoing policy provision is included in a policy which also
contains the next preceding policy provision, there shall be added to the
caption of the foregoing provision the phrase "-OTHER BENEFITS".
The insurer may, at its option, include in this provision a definition of
"other valid coverage," approved as to form by the commissioner,
which definition shall be limited in subject matter to coverage provided
by organizations subject to regulation by insurance law or by insurance
authorities of this or any other state of the United States or any
province of Canada, and to any other coverage to the inclusion of
which may be approved by the commissioner. In the absence of such
definition such term shall not include group insurance or benefits
provided by union welfare plans or by employer or employee benefit
organizations. For the purpose of applying the foregoing policy
provision with respect to any insured, any amount of benefit provided
for such insured pursuant to any compulsory benefit statute (including
any worker's compensation or employer's liability statute) whether
provided by a governmental agency or otherwise shall in all cases be
deemed to be "other valid coverage" of which the insurer has had
notice. In applying the foregoing policy provision no third party
liability coverage shall be included as "other valid coverage".
(6) A provision as follows: RELATION OF EARNINGS TO
INSURANCE: If the total monthly amount of loss of time benefits
promised for the same loss under all valid loss of time coverage upon
the insured, whether payable on a weekly or monthly basis, shall
exceed the monthly earnings of the insured at the time disability
commenced or the insured's average monthly earnings for the period of
two (2) years immediately preceding a disability for which claim is
made, whichever is the greater, the insurer will be liable only for such
proportionate amount of such benefits under this policy as the amount
of such monthly earnings or such average monthly earnings of the
insured bears to the total amount of monthly benefits for the same loss
under all such coverage upon the insured at the time such disability
commences and for the return of such part of the premiums paid during
such two (2) years as shall exceed the pro rata amount of the premiums
for the benefits actually paid; but this shall not operate to reduce the
total monthly amount of benefits payable under all such coverage upon
the insured below the sum of two hundred dollars ($200) or the sum of
the monthly benefits specified in such coverages, whichever is the
lesser, nor shall it operate to reduce benefits other than those payable
for loss of time.
The foregoing policy provision may be inserted only in a policy
which the insured has the right to continue in force subject to its terms
by the timely payment of premiums:
(1) until at least fifty (50) years of age; or
(2) in the case of a policy issued after forty-four (44) years of age,
for at least five (5) years from its date of issue.
The insurer may, at its option, include in this provision a definition of
"valid loss of time coverage", approved as to form by the
commissioner, which definition shall be limited in subject matter to
coverage provided by governmental agencies or by organizations
subject to regulation by insurance law or by insurance authorities of
this or any other state of the United States or any province of Canada,
or to any other coverage the inclusion of which may be approved by the
commissioner or any combination of such coverages. In the absence of
such definition the term shall not include any coverage provided for the
insured pursuant to any compulsory benefit statute (including any
worker's compensation or employer's liability statute), or benefits
provided by union welfare plans or by employer or employee benefit
organizations.
(7) A provision as follows: UNPAID PREMIUM: Upon the payment
of a claim under this policy, any premium then due and unpaid or
covered by any note or written order may be deducted therefrom.
(8) A provision as follows: CONFORMITY WITH STATE
STATUTES: Any provision of this policy which, on its effective date,
is in conflict with the statutes of the state in which the insured resides
on such date is hereby amended to conform to the minimum
requirements of such statutes.
(9) A provision as follows: ILLEGAL OCCUPATION: The insurer
shall not be liable for any loss to which a contributing cause was the
insured's commission of or attempt to commit a felony or to which a
contributing cause was the insured's being engaged in an illegal
occupation.
(10) A provision as follows: INTOXICANTS AND NARCOTICS:
The insurer shall not be liable for any loss sustained or contracted in
consequence of the insured's being intoxicated or under the influence
of any narcotic unless administered on the advice of a physician.
The policy provision under this subdivision may not be used with
respect to a policy that provides coverage for hospital, medical, or
surgical expenses.
(c) If any provision of this section is in whole or in part inapplicable
to or inconsistent with the coverage provided by a particular form of
policy the insurer, with the approval of the commissioner, shall omit
from such policy any inapplicable provision or part of a provision, and
shall modify any inconsistent provision or part of the provision in such
manner as to make the provision as contained in the policy consistent
with the coverage provided by the policy.
(d) The provisions which are the subject of subsections (a) and (b),
or any corresponding provisions which are used in lieu thereof in
accordance with such subsections, shall be printed in the consecutive
order of the provisions in such subsections or, at the option of the
insurer, any such provision may appear as a unit in any part of the
policy, with other provisions to which it may be logically related,
provided the resulting policy shall not be in whole or in part
unintelligible, uncertain, ambiguous, abstruse, or likely to mislead a
person to whom the policy is offered, delivered, or issued.
(e) "Insured", as used in this chapter, shall not be construed as
preventing a person other than the insured with a proper insurable
interest from making application for and owning a policy covering the
insured or from being entitled under such a policy to any indemnities,
benefits, and rights provided therein.
(f)(1) Any policy of a foreign or alien insurer, when delivered or
issued for delivery to any person in this state, may contain any
provision which is not less favorable to the insured or the beneficiary
than is provided in this chapter and which is prescribed or required by
the law of the state under which the insurer is organized.
(f)(2) Any policy of a domestic insurer may, when issued for
delivery in any other state or country, contain any provision permitted
or required by the laws of such other state or country.
(g) The commissioner may make reasonable rules under IC 4-22-2
concerning the procedure for the filing or submission of policies
subject to this chapter as are necessary, proper, or advisable to the
administration of this chapter. This provision shall not abridge any
other authority granted the commissioner by law.
Formerly: Acts 1953, c.15, s.169.3; Acts 1971, P.L.392, SEC.1;
Acts 1973, P.L.275, SEC.4; Acts 1974, P.L.1, SEC.13. As amended by
P.L.28-1988, SEC.104; P.L.93-1995, SEC.8; P.L.91-1998, SEC.10;
P.L.162-2001, SEC.2; P.L.178-2003, SEC.60; P.L.98-2007,
SEC.1.