1. (a) The insurer is responsible for the timely offer of conversion and continuation options and shall provide the conversion and continuation notice as described in subsection (b) of this section.

2. (b) Not less than 30 days before termination or discontinuance, a notification of conversion and continuation privileges available shall be provided to each employee, member, or dependent whose coverage is terminating.

   1. (1) In situations in which the employer or group policyholder becomes aware that coverage will terminate less than 30 days before actual termination, notification shall be given to the affected employee, member, or dependent immediately.
   2. (2) The time limit required by this subsection in no way affects or limits the notice requirements specified in the Insurance Code, Article 3.51-6, §3B. In instances in which the group policyholder is required to give notice of continuation immediately upon receipt of written notification of an event triggering the election of a continuation option, the statutory time limits shall prevail.

3. (c) The notification required in subsection (b) of this section shall be provided as follows:

   1. (1) The notice shall include the following information regarding conversion:

      1. (A) an explanation of the criteria which must be met in order to be eligible for conversion as set out in §3.504 of this title (relating to Eligibility for Mandatory Group Conversion and Continuation Privilege);
      2. (B) for group policies issued, delivered, or renewed prior to June 1, 1996, a statement of the option to convert to a policy providing the same coverage and benefits as those provided by the preceding group contract, including a description of the actual benefits;
      3. (C) for group policies issued or delivered on or after June 1, 1996, a statement of the option to convert to a policy providing coverage and benefits similar to those provided by the preceding group contract, including a description of the actual benefits;
      4. (D) a statement of the options to convert to a policy of lesser coverage and benefits, including a description of the actual benefits;
      5. (E) the time period allocated for making the election and paying the required premium;
      6. (F) the actual required premium amount for each option;
      7. (G) instructions on how and to whom the first premium payment is to be made;
      8. (H) a statement of when the conversion policy will become effective; and
      9. (I) a statement of the renewability provisions.

   2. (2) The notice shall include the following information regarding continuation:

      1. (A) the time period allocated for making the election to continue as prescribed in Insurance Code, Article 3.51-6, §1(d)(3)(B)(ii);
      2. (B) the premium amount which an employee, member, or dependent electing continuation of coverage must pay to the employer/group policyholder on a monthly basis in advance;
      3. (C) the date on which the employer/group policyholder must receive the employee's, member's, or dependent's written election to continue and the first premium contribution; and
      4. (D) the length of time one may continue coverage.

   3. (3) Additionally, the notice shall include:

      1. (A) other conversion options available, if any, including a description of the actual benefits and required premium;
      2. (B) enrollment/election form and signature line; and
      3. (C) the following English/Spanish statement at the end of the notice: "If you have questions regarding your rights for conversion or continuation of your health insurance, contact (insert name of insurance company) at (insert company toll-free telephone number, or other telephone number if no toll-free number is available). If you have additional questions, you may contact the Texas Department of Insurance, toll-free, at (800) 252-3439." "Si usted tiene una pregunta sobre sus derechos bajo el proceso de convertir o de continuar el seguro de salud, hable (insert name of insurance company) por el numero (insert company toll-free telephone number, or other telephone number if no toll-free number is available). Si usted necesita mas informacion, se puede comunicar con el Departamento de Seguros de Tejas por el numero gratis (800) 252-3439. Se habla espanol."
4. (d) In order to eliminate duplicate information requirements and insure adequate notification to each eligible employee, member, or dependent, delivery of the mandatory notification to each individual within the specified time period by either the insurer or the employer/group policyholder shall satisfy the notification requirements of both the insurer and the employer/group policyholder.
5. (e) For information purposes, the insurer shall submit the required notice as outlined in this section to the department's Life/Health Group.

Source Note:The provisions of this §3.506 adopted to be effective December 30, 1993, 18 TexReg 9759; amended to be effective July 3, 1996, 21 TexReg 5857.