| Be it enacted by the People of the State of Maine as follows: |
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| | Sec. 1. 24-A MRSA §2411, as enacted by PL 1969, c. 132, §1, is | amended by adding a new paragraph at the end to read: |
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| | To prevent a recovery under this section for any application | for life, credit life, disability, long-term care, accidental | injury, specified disease, hospital indemnity or credit or | accident insurance, an insurer need only prove one of the acts | described in this section, not an act under subsections 1, 2 and | 3. |
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| | This bill clarifies that the Maine Revised Statutes, Title 24- | A, section 2411 should be read in the disjunctive, which is the | original intent of the law passed in 1969, but was not so | interpreted by the Maine Supreme Judicial Court in American Home | Assurance Co. v. Ingeneri, 479 A.2d 897 (Me. 1984). The Law | Court read the statute in the conjunctive, in effect, overriding | the Legislature's plain use of disjunctive construction in the | section. The Ingeneri decision has had the unintended | consequence of requiring the Federal Court in Maine to find that | another portion of the Insurance Code, which requires an | "incontestability clause" to be included in every health | insurance contract delivered in this State, to be rendered null | and void. Incontestability clauses are a consumer protection, | preventing insurers from contesting representations made on | insurance applications after 3 years, unless the insurer can | prove fraud. Maine thus became the only state without an | "incontestability" provision. This bill overrules Ingeneri and | restores the original intent of the statute. |
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