Weekly Tip: Filing Applications with the Insurance Compact

 

Weekly Tips

Filing Applications with the Insurance Compact

8/5/2016

Applications are one of the most frequently filed forms. This week’s tip will help filers who wish to submit a supplemental application for use with a Compact-approved form.

When conducting a review of an application form, Compact reviewers check for compliance with the General Additional Submission Requirements, including the following provision that is common across all Application Uniform Standards:

The filing shall include all the sections and questions that may be required to be completed by an applicant, including additional drop downs, scripts, questions, questionnaires or supplements that would be required if the applicant answers questions in a certain way, such as a “yes” response.

As part of this review, we will look at the Statement of Intent (“SOI”) Schedule if the filing is marked for Mix and Match, and will issue an objection if parts of the application that the application in the pending filing will be used with are state-approved and being “mixed and matched” in combination with the Compact-submitted application. In other words, if questions, questionnaires or supplements that would be required to be answered as part of the application form submitted for approval to the Compact are contained in a state-approved application form, an objection will be issued.

This requirement makes sense, as it ensures that a question which may not be allowed under the Uniform Standards does not make its way into an application through the use of Mix and Match. If your company is still filing its application forms state-by-state because of this provision in the Uniform Standards, please contact the IIPRC Office, as we have already worked with several companies (especially ones with multi-part applications) to set a reasonable timeline for moving the various parts of applications into the Compact to ensure compliance with the above-referenced general submission requirement contained in all Application Uniform Standards.

There is a distinction to the general rule which you may not be aware of. A product-specific supplemental application can be filed with the Insurance Compact, even though it may be used in conjunction with other previously-approved/filed state applications or application supplements.

The best way to understand this is by way of example. Say a company has filed a Terminal Illness Rider and Chronic Illness Rider with the Insurance Compact and included a Supplemental Application to ask questions specific to applying for these riders. The SOI Schedule in this filing may show that it is being used with one or more previously-approved/filed state applications. In filings such as these, the Insurance Compact encourages companies to include supplemental applications specific to a product or benefit feature that has been or will be filed with the Insurance Compact in either the application filing or a subsequent Compact filing. Companies may face questions or concerns from states if supplemental applications that are specific to a product or benefit feature are being filed with the states for Mix and Match use with Compact-approved products or benefit features. If the product could be filed with the Insurance Compact, then presumably the associated supplemental application could and should be as well. This will allow companies to realize the full effects of uniformity and speed-to-implementation offered by the Insurance Compact.

If you have any questions about filing applications with the Insurance Compact or this Weekly Tip, please contact the IIPRC Office at Comments@insurancecompact.org.