Key Takeaways
- Illinois requires a 10-day free look period for disability insurance policies
- Individual disability policies must include a 30-day grace period for premium payment
- Illinois Long-Term Care Partnership Program provides Medicaid asset protection
- LTC policies must offer inflation protection options and nonforfeiture benefits
- LTC policies have a 30-day free look period in Illinois
Illinois Disability and Long-Term Care Insurance
Illinois has specific regulations for disability income insurance and long-term care insurance that protect consumers and ensure adequate coverage.
Disability Income Insurance
Free Look Period
Illinois requires a 10-day free look period for individual disability insurance:
- Policyholder can return for full premium refund
- Begins when policy is delivered
- Applies to individual policies
Required Policy Provisions
Illinois disability policies must include:
| Provision | Requirement |
|---|---|
| Grace Period | Minimum 30 days |
| Reinstatement | Must allow reinstatement within 3 years |
| Notice of Claim | Written notice within 20 days |
| Time to Pay Claims | Immediately upon receipt of proof |
| Legal Actions | No earlier than 60 days after proof |
Cancellation Requirements
For guaranteed renewable policies:
- Written notice before cancellation for nonpayment
- Cannot cancel for health reasons
- Can only cancel for nonpayment or fraud
Illinois Workers' Compensation
Illinois requires employers to provide workers' compensation coverage:
- Covers work-related injuries and illnesses
- Medical benefits
- Lost wage benefits
- Employers must obtain coverage or qualify as self-insured
Long-Term Care Insurance
Illinois has comprehensive LTC insurance regulations:
Free Look Period
- 30-day free look for LTC policies
- Applies to all individual LTC policies
- Policyholder can return for full refund
Required Provisions
| Provision | Requirement |
|---|---|
| Renewability | Must be guaranteed renewable |
| Pre-existing Conditions | Max 6-month look-back |
| Elimination Period | Must disclose clearly |
| Inflation Protection | Must offer option |
| Nonforfeiture | Must offer option |
Inflation Protection Options
Insurers must offer at least one inflation protection option:
- Compound inflation (3% or 5%)
- Simple inflation
- Consumer Price Index adjustment
- Benefit increase option
Illinois Long-Term Care Partnership Program
Illinois participates in the Long-Term Care Partnership Program:
How It Works
- Purchase a Partnership-qualified LTC policy
- Use benefits for care
- If benefits exhaust, apply for Medicaid
- Asset protection - Keep assets equal to benefits received
Example
| Without Partnership | With Partnership |
|---|---|
| Spend down to $2,000 | Protect assets up to benefits paid |
| Lose home equity | May keep home and assets |
| Standard Medicaid rules | Enhanced asset protection |
Producer Requirements
To sell LTC insurance in Illinois:
- Complete required LTC-specific training
- Complete training before selling
- Ongoing CE requirements for LTC
How long is the free look period for long-term care insurance in Illinois?
What is the primary benefit of purchasing an Illinois Partnership-qualified long-term care policy?
What is the minimum grace period for premium payment on individual disability policies in Illinois?