Chapter Six: Exclusions, Restrictions, Riders and Prohibited Provisions

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:

Amy's premiums may be increased on a class basis, and her policy may be terminated when she reaches the age of 65 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.

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

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

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

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

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

Impairment rider The impairment rider excludes coverage; therefore, the premium would not increase.

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

Increase the premium rate for an entire class of insureds 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.

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

Noncancelable 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.

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

Nonoccupational coverage 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.

Workers' Compensation is:

Occupational Coverage Workers' Compensation only provides coverage for injuries or sicknesses that occur while on the job.

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

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

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

Participation in a felony Self-inflicted injuries Act of war Policies often exclude coverage for sickness or injury resulting from an act of war, participation in a felony and self-inflicted injuries.