(a) The premiums paid for a long-term care insurance contract are deductible pursuant to Section 40-18-15, if the contract meets the following requirements:
- (1) Offers coverage only for qualified long-term care services and benefits incidental to the coverage.
- (2) Guaranteed renewal.
- (3) No cash surrender value.
- (4) All refunds of premiums and all policyholder dividends or similar amounts under the contract are to be applied as a reduction in future premiums or to increase future benefits, except for a refund of premiums on surrender or cancellation of the policy.
- (b) For purposes of this chapter, a long-term care insurance contract shall be treated as an accident or health insurance contract. The amount of coverage under the long-term care insurance contract shall be equal to or greater than Medicaid coverage for a period of at least three years.
- (c) An insurance contract shall not fail to be treated as a long-term care contract by reason of the payments being made on a per diem or other periodic basis without regard to the expenses incurred during the period to which the payments relate.
- (d) A long-term care insurance contract may cover Medicare reimbursable expenses where Medicare is a secondary payor.
- (e) In the case of long-term care insurance coverage provided by a rider on a life insurance contract, this chapter shall apply as if the portion of the contract providing long-term care coverage was a separate contract.
- (f) The deduction is available to the person or entity who pays the premiums.
(Acts 1995, No. 95-738, p. 772, §2.)