20-1097.04. Prepaid legal insurance contract provisions

A. A corporation may not issue a contract or certificate of prepaid legal insurance in this state unless a copy of the form has been filed with and approved by the department.

B. A corporation may write prepaid legal insurance contracts as individual, group, payroll deduction, blanket or franchise contracts. Each contractual obligation for prepaid legal insurance shall be evidenced by a contract. The corporation shall issue a certificate of the contract's coverage to each person protected under a group policy.

C. The department shall approve a contract form which contains all of the following:

1. A list and description of the legal service payments promised or the legal matters for which expenses are to be reimbursed and any limits on the amounts to be paid or reimbursed.

2. A clear statement of the name of the corporation issuing the contract and the full address of its principal place of business.

3. A statement that the individual beneficiary may retain at his own expense, except if the policy provides otherwise, any attorney authorized to practice law in this state.

D. Contracts with certificates issued under group policies must contain a full statement of the benefits provided and exceptions to the benefits but may summarize the other terms of the master contract.

E. No contract, except a policy issued by a mutual or reciprocal insurance company, may provide for assessments on contract beneficiaries or policyholders or for reduction of benefits for the purpose of maintaining a corporation's solvency.