Health Policy Provisions Flashcards

A health policy provision stating that 'no statement made by any agent shall modify this contract' reflects which mandatory provision?

Answer: Entire Contract provision

The Entire Contract provision limits the contract to the policy and attached documents, preventing agents from altering terms through oral statements or side agreements.

When a policy lapses and the insured later pays the overdue premium to reinstate coverage, which condition must typically be met for reinstatement?

Answer: Payment of premium and evidence of insurability

Reinstatement typically requires payment of the overdue premium plus evidence of insurability, confirming the insured's health has not materially changed during the lapse.

The Time Limit on Certain Defenses provision prohibits an insurer from contesting a policy after it has been in force for a set period, EXCEPT in cases of:

Answer: Fraudulent misrepresentations

Even after the contestability period expires, an insurer may still void a policy or deny claims based on intentional fraudulent misrepresentations by the applicant.

Under the Payment of Claims provision, disability income benefits are typically payable:

Answer: Monthly, throughout the period of disability

Disability income benefits are payable periodically—typically monthly—throughout the period of covered disability, providing ongoing income replacement.

If an insured is injured and receives benefits from both a health insurer and an at-fault driver's auto liability insurer, which provision allows the health insurer to seek reimbursement from the auto settlement?

Answer: Subrogation provision

Subrogation allows the health insurer to recover amounts it paid from the proceeds of any settlement the insured receives from the negligent third party.

Which optional health policy provision allows an insurer to reduce or deny benefits if an insured's loss is caused or worsened by an excluded pre-existing condition?

Answer: Preexisting Conditions provision

The Preexisting Conditions provision allows the insurer to limit or exclude benefits for conditions that existed before the policy's effective date, subject to state law limitations.

Under the Relation of Earnings to Insurance optional provision, if an insured's disability income benefits exceed their earned income at the time of disability, the insurer may:

Answer: Reduce benefits to the insured's average monthly earnings

The Relation of Earnings to Insurance provision limits disability benefits to the insured's actual earned income to prevent over-indemnification and moral hazard.