Sec. 31.10.30.04. Timing and Content of Notice of Adverse Benefit Determination

A. An insurer shall give written or electronic notice that complies with the standards imposed by 29 CFR §2520.104b-1(c)(1)(i), (iii), and (iv), of an adverse benefit determination to a covered individual within a reasonable period of time, but not later than 45 days after receipt of a claim for disability benefits, unless the 45-day period is extended in accordance with this regulation.

B. Subject to §F(2) of this regulation, the period of time within which a benefit determination shall be made begins at the time a claim is received, without regard to whether all the information necessary to make a benefit claim determination accompanies the filing.

C. The 45-day time period under §A of this regulation may be extended for up to 30 days if the insurer:

(1) Determines that the extension is necessary due to matters beyond the control of the insurer; and

(2) Provides the notice required under §E of this regulation to the covered individual before the expiration of the initial 45-day period.

D. The first 30-day extension may be extended for an additional 30 days if the insurer:

(1) Determines that, due to matters beyond the control of the insurer, a decision cannot be rendered within the first 30-day extension period; and

(2) Provides the notice required under §E of this regulation to the covered individual before the expiration of the first 30-day extension period.

E. The notice of an extension under §§C and D of this regulation shall be in writing and include:

(1) A description of the circumstances requiring the extension of time;

(2) The date by which the insurer plans to render a decision;

(3) A specific explanation of:

(a) The standards on which entitlement to a disability benefit is based;

(b) The unresolved issues that prevent a decision on the claim; and

(c) The additional information needed to resolve the issues; and

(4) A statement that the covered individual shall be given at least 45 days within which to provide the specified information.

F. If the period of time within which a benefit determination is required to be made is extended under §C or D of this regulation due to a covered individual's failure to submit information necessary to decide a claim:

(1) The covered individual shall be given at least 45 days within which to provide the information; and

(2) The period for making the benefit determination is tolled (temporarily suspended) from the date on which the notice of the extension is sent to the covered individual until the date on which the covered individual responds to the request for additional information.

G. The notice of an adverse benefit determination shall include:

(1) The specific reason or reasons for the adverse benefit determination;

(2) A reference to the specific policy provisions on which the adverse benefit determination is based;

(3) A description of any additional material or information necessary for the covered individual to perfect the claim and an explanation of why the material or information is necessary;

(4) A description of the insurer's appeal procedures and the time limits applicable to the procedures; and

(5) If an internal rule, guideline, protocol, or similar criterion was relied on in making the adverse benefit determination, either:

(a) The specific rule, guideline, protocol, or other similar criterion; or

(b) A statement that:

(i) An internal rule, guideline, protocol, or other similar criterion was relied on in making the adverse benefit determination; and

(ii) A copy of the rule, guideline, protocol, or other similar criterion will be provided on request free of charge to the covered individual.