State RegulationsNY specificDifficulty 3/5
An applicant for a New York long-term care policy is replacing existing long-term care coverage that has been in force without interruption. If the new policy contains a preexisting condition limitation, how must the insurer apply it?
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
Under Reg 62 (11 NYCRR Part 52), a preexisting condition limitation may exclude coverage for at most 6 months after the effective date, and the exclusion period must be reduced by the applicant's uninterrupted prior long-term care coverage. An insured who moves from one policy to another without a gap therefore keeps protection against a full new exclusion period.
Why the other options are wrong
- A) Prior coverage reduces the limitation for the replacing insured; it does not force the insurer to abandon the limitation for every applicant.
- C) Replacement does not restart a full exclusion period; uninterrupted prior coverage must be credited against it.
- D) The credit applies to the preexisting condition exclusion, not to the elimination period the insured must satisfy before benefits begin.
Memory hook
Replace without a gap: prior coverage trims the preexisting clock.