Grace Periods for Small Group Employer (0-50 EE’s)
- Grace period may be initially applied to April or May premium as the policyholder determines and will continue for 60 days from that date.
- Coverage MUST remain in force and claims must be paid not pended.
- If a carrier has already provided a grace period for April premium, the time period for which a grace period has already been granted shall be applied toward the emergency grace period.
- Grace period only applies to policyholders that were in good standing with their insurance carrier on March 1, 2020.
- After 60-day emergency grace period, the policyholder MUST be offered the option of amortizing any unpaid premium over the remaining months of the policy, but not less than 6 months.
Grace Periods for Large Group Employer (51+)
- Carriers shall make available an emergency 60-day grace period for any policyholder that has been financially or physically impacted by COVID-19.
- Policyholder MUST provide carrier with an attestation from a senior financial officer (CFO) or certified public accountant attesting to the hardship cause by COVID-19.
- Carriers may also make the emergency grace period available to any large employer at the carriers discretion.
- Grace period may be initially applied to April or May premium as the policyholder determines and will continue for 60 days from that date.
- Coverage MUST remain in force and claims must be paid not pended.
- After 60-day emergency grace period, the policyholder MUST be offered the option of amortizing any unpaid premium over the remaining months of the policy, but not less than 6 months.
Grace Periods for Life Insurance Policies
- Waive late fees otherwise due, including any interest permitted pursuant to N.J.S.A 17B:25:3, and not report late payments to credit rating agencies during the 90-day period.
- A policyholder may elect this 90-day grace period to begin retroactively on 4/1/20 or opt for the grace period to begin on 5/1/20.
- Insurance companies cannot cancel any insurance policy for non-payment of premium during this extended grace period
- Allow premiums due but not paid during the 90-day grace period to be paid over the course of the following year in up to 12 equal installments, except that an insurer may permit longer repayment period.
The Order is effective immediately. IMPORTANT: We are waiting on carrier responses to how they will interpret the order and are expecting formal notifications to be released in the next few days.
For more information on this order or any bills we are watching, please consult Innovative Benefit Planning. This is an evolving situation that we will continue to closely monitor and keep you updated as events happen.
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