For how long must the replacing insurer keep copies of the notice and policy summary?

The correct duration for which the replacing insurer is required to keep copies of the notice and policy summary is three years. This requirement ensures that there is a record of the information provided to the policyholder during the replacement process. Retaining these documents for this period serves multiple purposes, including the ability to review and verify compliance with regulations concerning policy replacements. It also provides an avenue for addressing any disputes or inquiries that may arise regarding the policyholder's decision to switch insurers.

Options reflecting a shorter retention period may not comply with regulatory standards, as they may not provide sufficient time for potential audits or reviews. A longer retention period could lead to unnecessary storage of documents that are not required beyond the stipulated timeframe, which may not serve the needs of the insurer effectively. Therefore, the three-year requirement strikes a balance between regulatory compliance and practical document management.