Lesson 10 Health Insurance Policy Provisions

Question 1

Under NAIC Uniform Policy Provision law there are ____ standard (mandatory) provisions and ____ options provisions

Answer 1

12

11

policy clauses establish the rules in the contract that both the insured and the insurance company must adhere to.

Question 2

Mandatory Provisions

Answer 2

1 entire contract

2. 2 year time limit on defenses provision
3. grace period 7, 10, 30 (weekly, monthly, others)
4. Reinstatement- 45 days
5. Notice of Claim Provision- 20 days
6. Claim forms provision- 15 days
7. Proof of loss provision- 90 days
8. Time payment of claims- 30 days
9. Payment of claims
10. Physical exam and autopsy
11. Legal Actions- 60 days, 5 years
12. Change of beneficiary

Question 3

Optional Provisions

Answer 3

1. change of occupation
2. misstatement of age
3. other insurance on this insurer
4. Insurance with other insurer
5. insurance with other insurers
6. Relation of earning to insurance
7. unpaid premiums
8. cancellation
9. Illegal occupation
10. Intoxicants and narcotics

Question 4

Common Exclusions

Answer 4

1. war injuries
2. self inflicted injuries
3. crew members of aircraft
4. hernia (usually limited to 6 months)
5. riots
6. injuries while committing a felony
7. Extended overseas stays
8. injuries suffered through use of illegal drugs/narcs

Question 5

Restrictions

Answer 5

1. maternity benefits
2. preexisting conditions
3. waiver for impairment

Question 6

Renewability Provisions

Answer 6

1. cancelable policies
2. optionally renewable policies
3. conditionally renewable policies
4. guaranteed renewable policies
5. noncancelable policies

Question 7

Consideration Clause

Answer 7

Sets forth the amount of initial and renewal premiums and frequency of future payments

Question 8

Conversion Privilege

Answer 8

allows policy owner before original policy expires to elect to have a new policy issued that will continue coverage.

Conversion may be effected at attained age or at original age

Question 9

Entire Contract Provision

Answer 9

application and policy contain all provisions and therefore constitute entire contract

Question 10

Free Look Period

Answer 10

specified # of days to examine policy with no obligation

Question 11

Grace Period

Answer 11

time after due date during which policy remains in force without penalty

Question 12

Guaranteed Renewable

Answer 12

health contract that insured has right to continue in force by payment of premiums for a substantial period of time during which the insurer has no right to make unilaterally any change in any provision

Question 13

Insuring Clause

Answer 13

Defines and describes scope of coverage provided and limits of indemnification

Question 14

Misstatement of Age Provision

Answer 14

if age is misstated in application, the benefit is usually adjusted to what the premiums paid should have purchased

Question 15

Notice of Claims Provision

Answer 15

Describes owners obligations to provide notification of loss to the insurer within a reasonable period of time

Question 16

Optionally Renewable

Answer 16

Health policy in which the insurer reserves the right to terminate coverage at any anniversary, premium date, but does not have right to terminate between those dates

Question 17

Proof of Loss

Answer 17

insured must provide completed claim form to the insurer within 90 days of date of loss

Question 18

Reinstatement Clause

Answer 18

putting lapsed policy back in force by producing evidence of insurability and paying past premiums

Question 19

Time Limit on Certain Defenses Provision

Answer 19

policy is incontestable after it has been in force for a certain time. limits the time during which and insurer can deny a claim on basis of preexisting condition.