11/4 Quiz: EXCLUSIONS, RESTRICTIONS, RIDERS AND PROHIBITED PROVISIONS

A cancelable renewability provision for accident and health policies means the insurer:

Cancelable policies allow the insurer to cancel the policy at any time (some states require notice of at least 30 days), provided the insurer returns all unearned premiums. Cancelation does not limit, exclude, or in any other way affect processing of claims for the period in which the policy coverage was effective. The correct answer is: May cancel the policy at any time

Of the following renewal provisions for health insurance, which is least favorable to the insured?

Cancelable policies allow the insurer to cancel the policy at any time. This is the least favorable for the insured. The correct answer is: Cancelable

The __________________ excludes coverage for a particular condition.

Impairment riders exclude coverage for a specific condition that would otherwise be covered under the policy. The correct answer is: Impairment rider

Which rider excludes coverage for a particular condition?

Impairment riders exclude coverage for a specific condition that would otherwise be covered under the policy. The correct answer is: Impairment rider

Which of the following health insurance exclusions/restrictions pays benefits for sickness or injury that occurs while the insured is not at work?

Occupational coverage provides for the payment of benefits for sickness or injury of the insured that occurred at work, while nonoccupational coverage excludes any conditions resulting from job-related activities. The correct answer is: Nonoccupational coverage

Which of the following is not a standard exclusion/restriction in a health policy?

Old age is not a standard exclusion in a health policy. The correct answer is: Old age

Health insurance exclusions/restrictions exclude coverage for losses resulting from:

Policies often exclude coverage for sickness or injury resulting from an act of war, participation in a felony and self-inflicted injuries. The correct answer is: All of the above

A policy that cannot be canceled and premiums cannot be raised is:

Premiums cannot be increased and coverage cannot be canceled (until age 65) in noncancelable policies. The correct answer is: Noncancelable

Which renewability provision describes a health insurance policy that cannot be canceled, nor have its premiums raised?

Premiums cannot be increased and coverage cannot be canceled (until age 65) in noncancelable policies. The correct answer is: Noncancelable

Which of the following explanations best describes why insurers exclude losses for self-inflicted injuries?

Self-inflicted injuries are excluded so the insurer is not paying claims which cause the insured to profit from a loss. The correct answer is: Prevents the insured from profiting from a claim

Suicide, pre-existing conditions, and self-inflicted injuries are dealt with in which of the following policy features?

Suicide, pre-existing conditions, and self-inflicted injuries are included in the exclusions clause. The correct answer is: Exclusions

This renewability provision guarantees renewal of a health insurance policy up to a certain age or date except for conditions specified in the policy:

The conditionally renewable provision guarantees the renewal of a health insurance policy up to a certain age or date; however, the insurer reserves the right to cancel the policy for specific conditions stated in the policy. The correct answer is: Conditionally renewable

Under a guaranteed renewable accident and health policy, an insurer retains the right to:

Under guaranteed renewable accident and health policies, the insurer is obliged to renew a policy, but may change the premium rate for a class or group of insureds. This variance results from changes in costs of providing coverage for that group. The correct answer is: Increase the premium rate for an entire class of insureds

Which of the following best describes a guaranteed renewable accident and health insurance policy?

With a guaranteed renewable accident and health insurance policy, the insurer may only raise premiums on a class-basis, not individually. The correct answer is: The insurer may increase the premium for an entire class of insureds.

Workers' Compensation is:

Workers' Compensation only provides coverage for injuries or sicknesses that occur while on the job. The correct answer is: Occupational coverage

Which accident and health renewability provision allows the insurer to renew the contract for certain specified reasons indicated in the policy?

Conditionally renewable policies allow the insurer the right not to renew the contract for any reason specified in the policy. The correct answer is: Conditionally renewable

All of the following are typical policy exclusions for health insurance, EXCEPT:

Conformity with state statutes is an optional policy provision and assures that policies are always in alignment with state laws. The correct answer is: Conformity with state statutes

Which accident and health renewability provision guarantees continuation of coverage for the insured until the insured reaches a specified age, as indicated in the policy?

A guaranteed renewable policy guarantees continuation of coverage for the insured until the insured reaches a specified age, as specified in the policy, but provides the insurer the right, at the time of renewal of a policy, to make changes in premium rates by classes of insureds, not individually. The correct answer is: Guaranteed renewable

Amy purchases a health insurance policy. The renewability feature is specified as "guaranteed renewable until age 65." All of the following statements are false, EXCEPT:

A guaranteed renewable to age 65 health insurance policy allows the insurer to increase premiums on a class basis and terminate the policy when the insured reaches the age of 65. The correct answer is: Amy's premiums may be increased on a class basis, and her policy may be terminated when she reaches the age of 65

Helen has a health insurance policy that is guaranteed renewable until age 65. Which of the following statements is true?

A guaranteed renewable to age 65 health insurance policy allows the insurer to increase premiums on a class basis and terminate the policy when the insured reaches the age of 65. The correct answer is: Helen's premiums may be increased on a class basis, and her policy may be terminated when she reaches the age of 65

Which accident and health renewability provision is the same as the guaranteed renewable provision, except that premiums cannot be increased?

A noncancelable policy provides the insured the right to continue coverage by making timely payment of premiums. The insurer cannot make changes to a noncancelable policy without the consent of the insured. The noncancelable renewability provision is the same as the guaranteed renewable provision, except that premiums cannot be increased. The correct answer is: Noncancelable

Roy purchases an individual health insurance policy from ABC Insurance Company. If he has had asthma since the age of 5, what action will the insurance company take in underwriting/issuing his policy?

ABC Insurance Company is likely to issue the coverage to Roy with an impairment rider, which simply excludes coverage for certain losses relating to asthma. The correct answer is: Issue the policy with an impairment rider

All of the following provisions may not be excluded from an individual accident and health policy, EXCEPT:

Injuries caused by alcohol or drug abuse, participation in a felony, and occupational injuries or sicknesses may all be excluded from individual health insurance coverage. The correct answer is: None of the above

Which policy renewability provision allows the insurer to non-renew coverage on a policy anniversary date?

Optionally renewable policies allow the insurer to non-renew the policy for any reason, but only on a policy anniversary date or premium due date. The correct answer is: Optionally renewable

A policy that permits the insurer to nonrenew coverage for any reason on a policy anniversary date is:

Optionally renewable policies allow the insurer to nonrenew the policy for any reason, but only on the policy anniversary date or premium due date. The correct answer is: Optionally renewable

Optionally renewable is best described as:

Optionally renewable policies provide the insurer the right not to renew the contract for any reason. The correct answer is: The insurer has the right to non-renew a contract for any reason

Tom purchases a disability income policy, and becomes disabled five years later. The disability is caused by medical condition he had before purchasing the disability income policy, but the policy does not specifically exclude coverage for a disability caused by this medical condition. What will the insurer do when Tom reports the claim?

Since the medical condition was not specifically excluded, the insurer will pay full benefits. Pre-existing condition exclusions cannot last longer than 18 months maximum, in most states. The correct answer is: Pay full benefits

All of the following health insurance riders will increase the policy's base premium, EXCEPT:

The impairment rider excludes coverage; therefore, the premium would not increase. The correct answer is: Impairment rider

All of the following are common exclusion from health policies, EXCEPT:

The self-inflicted injuries exclusion excludes or limits coverage for injuries or illnesses resulting from suicide, attempted suicide, or other self-inflicted injury of the insured. The correct answer is: Self-inflicted injuries

Of the following provisions, which assures renewability with no changes for life, so long as premiums are paid?

The term noncancelable applies to a policy in which the insured has the right to keep the policy exactly as it is written without any changes for life, so long as they pay premiums. The insurer may not alter any part of the policy unilaterally. All the others include options (e.g., guaranteed renewal clause assures renewability, but gives insurer the right to change the premium). The correct answer is: Noncancelable