PARRIS N. GLENDENING, Governor

Ch. 57

3. Acknowledges that the prospective policyholder was offered,
at the time of application for the policy, the opportunity to purchase coverage that
included all applicable mandated health insurance benefits and nondiscrimination
provisions otherwise required by law.

(2) The nonprofit health service plan or insurer shall provide to the
prospective policyholder a copy of the statement required under paragraph (1) of this
subsection, and the original of the statement shall be retained in the files of the insurer or
nonprofit health service plan for the longer of:

(i) The period that the policy is in effect; or

(ii) 5 years.

(g) (1) Except as provided in this section, all provisions of [this article] THE
INSURANCE ARTICLE shall apply to a limited benefits policy.

(2) Notwithstanding any other provision of [this article] THE INSURANCE
ARTICLE, a limited benefits policy is not subject to any mandated health insurance
benefit or nondiscrimination provision.

(h) (1) An individual or employer is eligible for coverage under a limited
benefits policy for a maximum of 3 consecutive years.

(2) An insurer or nonprofit health service plan may not cancel a limited
benefits policy except for nonpayment of premiums or failure to satisfy established
participation requirements.

(3) (i) If an individual or employer has been covered under a limited
benefits policy and has not been canceled under paragraph (2) of this subsection, the
insurer or nonprofit health service plan providing the limited benefits policy shall offer a
nonlimited benefits policy to the individual or employer, provided the individual or
employer makes application within 3 months from the date coverage under the limited
benefits policy ends.

(ii) The policy offered under subparagraph (i) of this paragraph shall

be offered:

1. Without medical underwriting; and

2. Without preexisting condition limitations to the extent any
preexisting condition limitations under the limited benefits policy have been satisfied.

(4) Three months prior to the termination of a limited benefits policy, an
insurer or nonprofit health service plan shall provide to the policyholder and all
beneficiaries a notice of the required offering under paragraph (3) of this subsection.

(i) (1) The INSURANCE Commissioner shall adopt regulations:

(i) Establishing a standard form to be completed by a limited benefits
policyholder under subsection (f)(l)(i) that gathers demographic data on the policyholder
and insureds under the policy;

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