PARRIS N. GLENDENING, Governor

Ch. 35

AN EMPLOYER THAT TERMINATES CONTINUATION COVERAGE AFTER NOTICE
OR NONPAYMENT OF AN AMOUNT REQUIRED UNDER SUBSECTION (D)(2) OF THIS
SECTION BY THE INSURED OR OTHER COVERED INDIVIDUAL, OR AN INSURER THAT
TERMINATES CONTINUATION COVERAGE AFTER NOTICE BY THE EMPLOYER, IS NOT
LIABLE TO THE INSURED OR OTHER COVERED INDIVIDUAL FOR BENEFITS THAT
OTHERWISE WOULD HAVE BEEN PAYABLE UNDER THIS SECTION IF THE
TERMINATION:

(1) IS MADE IN GOOD FAITH;

(2) IS REASONABLE UNDER THE CIRCUMSTANCES; AND

(3) IS NOT THE RESULT OF A MUTUAL OR MATERIAL MISTAKE OF FACT.
(K) CONVERSION PRIVILEGES NOT AFFECTED.

THIS SECTION DOES NOT AFFECT OR LIMIT THE RIGHT OF AN INSURED TO
CONVERSION PRIVILEGES UNDER A GROUP CONTRACT.

REVISOR'S NOTE: This section is new language derived without substantive
change from former Art. 48A, § 490-I and, as they referred to former § 490-I,
§§ 354GG and 477HH.

In subsection (a)(2) of this section, the former reference to an "applicable"
change in status is deleted as surplusage.

In subsection (a)(3)(i) of this section, the reference to an "insurance" contract
is added for clarity and for consistency with similar provisions in §§ 15-407
and 15-408 of this subtitle.

Also in subsection (a)(3)(i) of this section, the reference to a nonprofit health
service "insurance" plan is deleted for consistency with terminology used
throughout this article.

In subsection (a)(4) of this section, the phrase "before the change in status" is
added for clarity.

In subsection (b)(1) and (2) of this section, the references to continuation
"coverage" are substituted for the former references to continuation
"benefits" for consistency with terminology used throughout this subtitle.
Similarly, in subsections (e)(1) and (2), (g)(1), and the introductory language
of subsection (j) of this section, the references to "continuation" coverage are
added. Similarly, in subsections (f)(1) and the introductory language of (h) of
this section, the references to "continuation coverage" are substituted for
former references to "benefits". Similarly, in subsection (f)(2) and (3) of this
section, the references to "continuation coverage" are substituted for the
former references to "such benefits". Similarly, in the introductory language
of subsection (h) of this section, the reference to notice "of the availability of
continuation coverage" is substituted for the former reference to notice "of
the benefits".

In subsection (b)(2) of this section, the phrase "if continuation coverage is

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