Unit 14: Health Insurance Policy Provisions Flashcards
Uniform Policy Provisions - Health Insurance
Mandatory in every insurance contract
Insurance companies are not required to use the exact working of theses provisions, they are allowed to reword them as long as the wording is not LESS FAVORABLE TO THE INSURED.
Entire Contract Changes
insurance policy represents a contract between the insurer and the insured and consists of:
- application-copy of the application, if attached to the policy
- insurance policy-the actual insurance contract
- riders (endorsements) and any other papers or amendments attached to the policy
in order for something to be included in the contract, if must be in writing, and it must be attached to the policy
an agent or producer may not change a policy or waive any of its provisions. For a change to be made, it must be approved in writing by an executive officer of the insurance company and attached to the policy in the form of an amendment
Incontestability Clause
time limit on contesting application information:
- two years after application
- Fraud in the application can void the policy when discovered
Grace Periods
7 days - weekly premium
10 days - monthly premium
31 days - all other policies
- insurance still in force during
- unpaid premiums deducted from a claim
Restatement
if you don’t pay premium after grace period, policy will lapse
application and receipt
must deny within 45 days after applications or policy is in effect
accident claims covers immediately
sickness claims covered 10 days after reinstatement
Notice of Claim
written _____ must be given to insurer within 20 days after occurrence or commencement of any loss covered by the policy or as soon thereafter as is reasonable possible
If continuing disability (for at least two years) can only be required to provide proof every six months
claim forms
insurers provide the claim form to the insured
must be furnished to insured within 15 days of notice of loss
proof of loss
must be given with 90 days
time of payment of claims
insurer to pay IMMEDIATELY
at least monthly if periodic claim such as a long term disability policy or long term care policy
Payment of claims
any death benefits to beneficiary or estate
faculty of payment $1000 to family member
medical exams and autopsy
insurer pays all costs if either of these are necessary: company requires and state law requires
Legal Action Against Insurer
Earliest this can happen is 60 days after proof of loss
maximum three years after proof of loss
Change of Beneficiary - Revocable
change any time by owner
Change of Beneficiary - Irrevocable
permission of beneficiary needed to change
Change of Occupation
If the insured changes to a more hazardous occupation, the insurer will reduce benefits to whatever the premium would have purchased at the higher risk occupation
If the insured changes to a less hazardous occupation, the insurer will reduce the premium rate accordingly and return the access pro rata unearned premium
Misstatement of Age- Benefits Increase
Younger than stated on application
Misstatement of Age- Benefits Reduced
Older than stated in application
Other insurance with this insurere
if an insured has more than one policy of a similar type with an insurance company, the insuere can limit the amount of befits that will be paid under all contracts.
total of all policies exceeds maximum:
- benefits reduced
- excess premiums refunded
insurance with other insurer
each company pays a proportionate share
excess premiums are refunded
Relation of earnings to Insurance (average earnings)
disability benefit exceeds earnings =
benefit reduced
excess premiums refunded
unpaid premium
the amount of the premium will be deducted from the benefit payable under the claim
claim - premium = payment to insured
Cancellation
company must give at least a five day notice
unearned premium must be refunded pro rata
insured cancels short rate penalty will apply
conformity with state statutes
Minimum requirements must be met
makes policy comply with laws of the insured’s state of residence
Right to Examine (Free Look)
when a policy is delivered to the insured, they have the right to look it over and decide where or not to keep it.
- 10 days from receipt or 30 days for senior products (Medicare supplements, LTC)
- Begins date received by policy holder
- If policy returned-complete refund of money
Renewablity
five types of provisions (cancelable, optionally renewable, conditionally renewable, guaranteed renewable, non-cancelable)
more favorable for insured = higher premium
Renewability - cancelable
the insurer can cancel at any time
Renewability - optionally renewable
the insurer has the option to renew or not for any reason on a premium due or anniversary date. Premiums may be increased on the policy anniversary for a class of insureds
Renewability - conditionally renewable
the insurer may terminate coverage but only for reasons not based on the insurer’s health such a s a reaching a certain age. premiums may be increased on the policy anniversary for a class of insureds
Renewability - guaranteed renewable
the policy cannot be canceled except for non-payment of premiums, and premiums may increase on a renewal date if the insurer has a raised premiums for all insureds in that coverage classification
Renewability - non-cancelable
the insurer cannot cancel coverage (except for non-payment of premium) or raise premiums
