Health Policy Provisions, Clauses, and Riders

Under a health insurance policy, benefits, other than death benefits, that have not otherwise been assigned, will be paid to

The insured

Which of the following statements is true regarding coinsurance?

The larger the percentage that is paid by the insured, the lower the required premium will be

L has a major medical policy with a $500 deductible and 80/20 coinsurance. L is hospitalized and sustains a $2,500 loss. What is the maximum amount that L will have to pay?

$900 (deductible + 20% of the bill after the deductible [20% of $2,000])

An insured pays a monthly premium of $100 for her health insurance. What would be the duration of the grace period under her policy?

10 days

The time limit of certain defenses provision prohibits insurers from denying a claim due to misrepresentation, as long as the policy has been in force for

2 years

In the event a policy lapses due to nonpayment of premium, how soon would the policy be automatically reinstated following the insured paying the outstanding premium?

45 days

Ray has an individual major medical policy that requires a coinsurance payment. Ray very rarely visits his physician and would prefer to pay the lowest premium possible. Which coinsurance arrangement would be best for Ray?

50/50

Under the uniform required provisions, proof of loss under a health insurance policy normally should be filed within

90 days of a loss

When an insured purchased her disability income policy, she misstated her age to the agent. She told the agent that she was 30 years old, when in fact, she was 37. If the policy contains the optional misstatement of age provision

Amounts payable under the policy will reflect the insured's correct age

While a claim is pending, an insurance company may require

An independent examination as often as reasonably required

What is the maximum period of time during which an insurer may contest fraudulent misstatements made in a health insurance application?

As long as the policy is in force

What is the main difference between coinsurance and copayments?

Copayment is a set dollar amount

Which of the following is NOT an exclusion in medical expense insurance policies? a. coverage for dependents b. military duty c. self-inflicted injuries d. Routine dental care

Coverage for dependents

A health insurance policy lapses but is reinstated within an acceptable timeframe. How soon from the reinstatement date will coverage for accidents become effective?

Immediately

Which of the following riders would NOT increase the premium for a policyowner?

Impairment rider

In the event of loss, after a notice of claim is submitted to the insurer, who is responsible for providing claims forms and to which party?

Insurer to the insured

Which of the following entities has the authority to make changes to an insurance policy?

Insurer's executive officer

Which of the following provisions would prevent an insurance company from paying a reimbursement claim to someone other than the policy owner?

Payment of claims

With respect to the Consideration Clause, which of the following would be considered consideration on the part of the application for insurance?

Payment of premium

Which of the following provisions is mandatory for health insurance policies?

Physical examination and autopsy

Which is true regarding the Uniform Individual Accident and Sickness Policy Provisions Law?

Provisions may be reworded by the insurer

Which of the following terms describes the specified dollar amount beyond which the insured no longer participates in the sharing of expenses?

Stop-loss limit

An insured purchased a noncancelable health insurance policy 1 year ago. Which of the following circumstances would NOT be a reason for the insurance company to cancel the policy?

The insured is in an accident and incurs a large claim

Insured Z's health insurance policy year begins in January. His policy contains a carry-over provision. In November, he has a small claim which is less than his deductible. Which of the following is true?

The insured may carry over the amount of this year's expenses to next year, which will help satisfy next year's deductible

An insured submitted a notice of claim to the insurer, but never received claims forms. He later submits proof of loss, and explains the nature and extent of loss in a hand-written letter to the insurer. Which of the following would be true?

The insured was in compliance with the policy requirements regarding claims

Which of the following is NOT a feature of a guaranteed renewable provision? a. The insurer can increase the policy premium on an individual basis b. The insured has a unilateral right to renew the policy for the life of the contract c. Coverage is not renewable beyond the insured's age 65 d. The insured's benefits cannot be reduced

The insurer can increase the policy premium on an individual basis

Which of the following will vary the length of the grace period in health insurance policies?

The mode of the premium payment

A policy with a 31-day grace period implies

The policy will not lapse for 31 days if the premium is not paid when due

Which of the following statements is most correct concerning the changing of an irrevocable beneficiary?

They can be changed only with the written consent of that beneficiary

How soon following the occurence of a covered loss must an insured submit written proof of such loss to the insurance company?

Within 90 days or as soon as reasonably possible, but not to exceed 1 year

The provision that provides for the sharing of expense between the insured and the insurance company is

Coinsurance

If more than one family member covered under the same major medical policy is injured in the same accident, the family only has to pay one deductible. This is due to the

Common accident provision

In health insurance, if a doctor charges $50 more than what the insurance company considers usual, customary and reasonable, the extra cost

Is not covered

A guaranteed renewable disability insurance policy

Is renewable at the insured's option to a specified age

What statement best describes the free look provision?

It allows the insured to return the policy within 10 days for a full refund of premiums if dissatisfied for any reason

The provision which prevents the insured from bringing any legal action against the company for at least 60 days after proof of loss is known as

Legal Actions

Under an individual disability policy, the MINIMUM schedule of time in which claim payments must be made to an insured is

Monthly

Which provision concerns the insured's duty to provide the insurer with reasonable notice in the event of a loss?

Notice of Claim

An insured notifies the insurance company that he has become disabled. What provision states that claims must be paid immediately upon written proof of loss?

Time of Payment of Claims

Which provision states that the insurance company must pay Medical Expense claims immediately?

Time of Payment of Claims

What is the purpose of coinsurance provisions?

To help the insurance company to prevent overutilization of the policy

When an insurer issues an individual health insurance policy that is guaranteed renewable, the insurer agrees

To renew the policy until the insured has reached age 65

Under the Physical Exam and Autopsy provision, how many times can an insurer have the insured examined, at its own expense, while a claim is pending?

Unlimited

All of the following are correct about the required provisions of a health insurance policy EXCEPT a. A grace period of 31 days is found in an annual pay policy b. The entire contract clause means the signed application, policy, endorsements, and attachments constitute the entire contract c. A reinstated policy provides immediate coverage for an illness d. Proof-of-loss forms must be sent to the insured within 15 days

A reinstated policy provides immediate coverage for an illness

Under the mandatory uniform provision Notice of Claim, the first notice of injury or sickness covered under an accident and health policy must contain

A statement that is sufficiently clear to identify the insured and the nature of the claim

When the insured purchased his health policy he was a window washer. He has since changed occupations and now manages a library. If the insurer is notified of the insured's change of occupation, the insurer should

Adjust the benefit in accordance with the decreased risk

An insured misstated her age on an application for an individual health insurance policy. The insurance company found the mistake after the contestable period had expired. The insurance company will take which of the following actions regarding any claim that has been issued?

Adjust the claim benefit to reflect the insured's true age

The provision that states that both the printed contact and a copy of the application form the contract between the policyowner and the insurer is called the

Entire Contract

The provision in a health insurance policy that ensures that the insurer cannot refer to any document that is not contained in the contract is the

Entire contract clause

Items stipulated in the contract that the insurer will not provide coverage for are found in the

Exclusions