Chapter 9: Health Insurance Policy Provisions EXAM

M's insurance Company denied a reinstatement application for her lapsed health insurance policy. The company did not notify M of this denial. How many days from the reinstatement application date does the insurance company have to notify M of the denial before the policy will be automatically pay please back in force

45 days Health insurance will automatically be placed back in force if the insured fails to notify an applicant within 45 days that the reinstatement application was denied

According to the mandatory uniform policy provisions, what is the maximum amount of time after the premium due date during which the policy remains enforced even though the premium has not been paid

31 days

And insured pays premiums on an annual basis for an individual health insurance policy. What is the minimum number of days for the grace period provision.

31 days

With accidental death and dismemberment policy's, what is the purpose of the grace period

Gives the policy owner additional time to pay overdue premiums

Which of the following provisions specifies how long a policy owner's health coverage will remain in affect if the policy owner does not pay the premium when it's due

Grace period

What's health policy clause specifies the amount of benefits to be paid

Insuring clause

Which of the following health insurance policy provisions specify the healthcare services the policy will provide

Insuring clause

The clause identifying which losses resulting from an accident or sickness are insured by the policy is called

Insuring clause (The Insuring clause identifies which losses resulting from an accident or sickness are insured by the policy.)

According to the Time Payment of Claims provision, the insurer must pay Disability Income benefits no less frequently than which of the following options?

Monthly The time of payment for claims is usually specified in different policies as 60 days, 45 days, or 30 days. However, if the claim involves disability income benefits, the benefits must be paid not less frequently than monthly.

J purchased a Disability Income Policy that ONLY J can terminate and on which the rates will never increase above those illustrated in the policy. Which of the following types of policies did J purchase?

Noncancelable. A Disability Income Policy that only the policyowner can terminate and on which the rates will never increase is a Noncancelable policy.

If an insurance company issues a disability income policy that it cannot cancel or for which it cannot increase premiums, the type of renewability that best describes this policy is

Noncancellable

Which type of renewability guarantees premium rates and renewability

Noncancellable

Which of the following best describes a short term medical expense policy

Nonrenewable. A typical short-term medical expense policy is best described as nonrenewable.

The notice of claims provision requires a policy owner to

Notify an insurer of a claim within a specified time. The Notice of Claims provision spells out the insured's duty to provide the insurer with reasonable notice in the event of a loss.

S Has filed a written proof of loss for a disability income claim on September 1. The insurance company did not respond to the claim. S can take legal action against the insurer beginning

November 1 The insured must wait 60 days after the written proof of loss before legal action can be brought against the company

Which of these is considered a mandatory provision

Payment of Claims is considered a mandatory provision and directs where the claim benefits will go. The others are considered optional provisions.

The provision that defines to whom the insurer will pay benefits to is called

Payment of Claims The Payment of Claims provision in a Health Insurance policy states to whom claims will be paid.

Which accident and health policy provision addresses pre-existing conditions

Time Limit on Certain Defenses This provision limits the period during which and insurer can deny a claim on the basis of a pre-existing condition

T files a claim on his accident and health policy after being treated for an illness. The insurance company believes that T Misrepresented his actual Health on the initial insurance application and is, Therefore, disputing the claims validity. The provision that limits the time During which the company may dispute a claim validity is called

Time limit on certain defenses

The policy provision that entitles the insurer to establish conditions the insured must meet while he claims pending

Time limit on certain defenses

According to the time limit of certain defenses provision in an individual health insurance policy, non-fraudulent miss statements first become incontestable

Two years from the date the policy was issued

What type of rider would be added to an accident and health policy if the policy owner wants to ensure the policy will continue if he/she ever becomes totally disabled

Waiver of premium rider

What is the initial requirement for an insured to become eligible for benefits under the waiver of premium provision

"Insured must be under a physician's care" Under Waiver of Premium, which is a rider that will pay your premium while you're disabled, you must have a doctor certify that you meet the definition of disability as contained in the rider.

When an insurance company sends a policy to the insured with an attached application, the element that makes the application part of the contract between the insured and the insurer is called

*Entire Contract provision (The Entire Contract provision states that the application and policy contain all provisions and constitute the entire contract.)

G is involved in an automobile accident as a result of driving while intoxicated and suffers numerous injuries. According to the Intoxicants and Narcotics exclusion in G's policy, who is responsible for paying the medical bills?

*The insured (In this situation, the insured is liable for the medical bills.)

Periodic health claim payments MUST be made at least

*monthly (Under an individual health policy, periodic claim payments must be made at least monthly.)

Which of the following statements describes what an accident and health policy owner may do

1. File a covered claim 2. Assign ownership 3. Cancel the coverage

Which of the following is included in the policy face

1. Name of the insured 2. Name of the insurer 3. Free look provision

The legal actions provision of an insurance contract is to design to do all the following,

1. Provide the insurer adequate time to research a claim 2. Protect the insured from having claim research delayed 3. Give the insured guidelines for pursing legal action against and insurer

If an individual has an accidental death and dismemberment policy and dies, an autopsy can be performed in all these situations,

1. When foul play was a contributing factor 2. when the cause of death is unknown 3. when consent for the autopsy is not obtained

An insurer must provide an insured with claim forms within __ days after receiving notice of a loss.

15 days Under the claims forms provision, an insurer must provide an insured with claim forms within a maximum of 15 days after receiving a notice of loss

Which of the following statements describes what an accident and health policy owner may not do

Adjust the premium payments.

Which of the following statements best describes what the legal actions Provision of an accident and health policy requires

An insured must wait at least 60 days after Proof of Loss has been submitted before a lawsuit can be filed The legal action provision on an accident and health policy requires that insurer settle a claim within 60 days after receipt of proof of loss

When does a Probationary Period provision become effective in a health insurance contract?

At the policy's inception (The probationary period begins when a policy goes into effect. During this period, no benefits will be paid under the policy.)

When an insured changes to a more hazardous occupation, which disability policy provision allows an insurer to adjust policy benefits and rates

Change of occupation provision The change of occupation provision allows an insurer to adjust policy benefits and/or rates if the insured has changed to a more hazardous occupation.

P is a major medical policy owner who is hospitalized as a result of injury sustained from participating in a car jacking. How will the insured most likely handle this claim

Claim will be denied if a person is injured while committing an illegal act, health insurance will not cover the expense of injury

A disability income policy owner recently submitted a claim for a chronic neck problem that has now resulted in total disability. The original neck injury occurred before the application was taken five years prior. The neck injury was never disclose to the insure at the time of the application. How will the insurer handle this claim

Claim will be paid and coverage will remain in force after a policy has been enforced for two sometimes three years, it enters the incontestable period, in which the insurer may not deny a claim based on information not disclosed at this time of

And insurance company receives E's application for an individual health policy. E Did not complete all of the medical history questions because she could not remember the exact dates. E signed the policy and submitted it to the insurance company anyway. A few weeks later, E suffers a heart attack and his hospitalized without completing the medical history questions and paying the initial premium. E is not insured. Which of the following clauses details the conditions that E did not meet

Consideration clause

Which of the following health policy provisions states that the producer does not have the authority to change the policy or waive any of its provisions

Entire Contract. The Entire Contract provision states that the producer does NOT have the authority to change the policy or waive any of its provisions.

The sections of an insurance contract which limit coverage are called

Exclusions

Which of the following is not included in the policy face

Exclusions ( "Exclusions". The exclusions section is NOT included in the policy face (first page of an insurance policy).

After an insured gives notice of loss, what must he/she do if the insurer does not furnish forms?

File written proof of loss

Which type of renewability best describes a disability income policy that covers an individual until the age of 65, but the insurer has the right to change the premium rate for the overall risk class

Guaranteed Renewable- The renewal provision in a guaranteed renewable policy specifies that the policy must be renewed (as long as premiums are paid) until the insured reaches a specified age. These usually have increasing premiums.

Kay has a health policy that must be renewed by the insurer and the premiums can only be increased if applied to the entire class of insureds. This type of policy is considered

Guaranteed renewability

And insurer receives proof of loss for an acceptable medical expense claim under an individual health insurance policy. Under the time of payment of claims provision the insurer must pay the benefits

Immediately After receiving proof

T owns an accident and health policy and notifies her insurance company that she has chosen a less hazardous occupation. Under the change of occupation provision, which of the following actions may her Insurance company take

Increase her policies coverage amount

What is considered to be a characteristic of a conditionally renewable health insurance policy

Premiums may increase at time of renewal. A Conditionally Renewable Health Insurance policy can increase premiums at time of renewal.

Which of the following statements about a guaranteed renewable health insurance policy is correct

Premiums normally increase at time of renewal- A guaranteed Renewable Health Insurance policy can have increasing premiums at time of renewal.

What must the policyowner provide to the insurer for validation that a loss has occurred?

Proof of Loss. A Proof of Loss statement must be provided to an insurance company to show that a loss actually occurred.

The legal actions provision of an insurance contract is to design to do all the following, except

Protect the producer

K failed to pay a renewal premium within the time granted by the insurer. K then sends in a payment which the insurer subsequently accepts. Which policy provision specifies that coverage may be restored in this situation?

Reinstatement. In this situation, coverage may be restored under the reinstatement provision.

The Insuring Clause

States the scope and limits of the coverage

What should an insured do if the insurer does not send claim forms within the time period set forth in a health policies claims forms provision

Submit the claim in any form if forms are not furnished, the insured should submit the claim in any form, which must be accepted by the company is adequate proof of loss

Jay, an accidental death and dismemberment policy holder, Dies after injury sustained in an accident. Jay's age as stated on the application five years ago was found to be understated by 10 years. Which of the following actions will the insurance company take

The insurer will adjust the benefit to what the premiums paid would have purchased at the insurance actual age

If an individual has an accidental death and dismemberment policy and dies, an autopsy can be performed in all these situations, except

When the state prohibits this by law Applicable state laws that prevent an autopsy take precedence.

Health insurance benefits not covered due to an act of war are

excluded by the insurer in the contract provisions An exclusion is a provision that entirely eliminates coverage for a specified risk, such as an act of war or aviation.

If an insurance company issues a disability income policy that it cannot cancel or for which it cannot increase premiums, the type of renewability that best describes this policy is called

noncancellable

With Optionally Renewable Health policies, the insurer may

review the policy annually and determine whether or not to renew it

An assignment of benefits of a Health Policy

transfers payments to someone other than the policyowner