When an insured changes to a more hazardous occupation, which disability policy provision allows

The following provisions are optional at the discretion of the insurer as mandated by the NAIC Uniform Health Insurance Policy Provision Law.

Change of Occupation

The occupation of a person directly reflects his/her risk profile, mostly to the risk of disability. If a person changes his job to a more risky profession, the insurance company has the right to raise the premiums and change the benefit policy or vice versa if the person changes to a less risky profession. The benefit and premium changes take place as soon as a person changes jobs. Even if the insured doesn't notify the insurer of the job change in advance, changes to the benefit will still take place (up or down accordingly) if disability occurs.

Misstatement of Age

This provision is the same as in life insurance, with a slightly different end result. This provision, in health insurance, allows the insurer to go back and make changes to the benefits so that they match the correct age. This means if a person stated originally that they were younger, the premiums they had been paying were lower than they should have been, and benefits would be adjusted (decreased) accordingly. Conversely, if a person stated originally that they were older than they really were at the time of application, then they would have been paying a higher premium and, therefore, benefits would be adjusted (increased) accordingly.

Other Insurance In This Insurer

There is a maximum amount an insurer is allowed to cover an individual in order to limit the company's risk. A person may occupy more than one policy with an insurer; however, this provision protects the company and does not allow the coverage to exceed a specified amount.

Insurance With Other Insurer

This provision protects the insurance company against over-insurance in case a person has the same coverage from two different insurance policies and only one is notified when "expenses are incurred." This provision states that benefits payable will be prorated and excess premiums will be refunded to the policyowner.

Insurance With Other Insurers

As you can see, this is similar to the above provision. This provision is to allow people to have insurance with more than one company, however, while still avoiding over-insurance. It calls for prorating benefits on any other reason than "expenses incurred," usually in regard to disability income.

Relation of Earnings to Insurance

This has to do with the amount of monies from premium payments the insurer received versus the loss the insurer suffered through claims payments. If disability income benefits from all disability income policies for the same loss exceed the insured's monthly earnings at the time of disability (or the average monthly earnings for two years preceding), the insurer is liable only for that proportionate amount of benefits as the insured's earnings bear to the total benefits under all such coverage.

In Florida, total indemnities payable to the insured may not be reduced below $500 or the sum total benefits under all applicable coverage, whichever is less. Any premiums paid for the excess coverage are refunded.

Unpaid Premiums

When a benefit is payable to the insured or beneficiary, if there are any unpaid premiums they will be deducted at this time.

Cancelation

When the insurance company exercises its right to cancel a policy, the insured must be notified 45 days in advance and must be reimbursed for any prepaid premiums.

Conformity with State Statutes

All conflicts regarding state statutes of the state the insured lives in are automatically adjusted at the time the policy is issued.

Illegal Occupation

If the insured is connected with a felony or has an illegal occupation and incurs injury, the insurance company is not held responsible.

Intoxicants and Narcotics

The insurer is not responsible for any loss that occurs while the insured is intoxicated or under the influence of narcotics unless drugs were administered by a physician.

The following provisions are optional at the discretion of the insurer as mandated by the NAIC Uniform Health Insurance Policy Provision Law.

Change of Occupation

The occupation of a person directly reflects his/her risk profile, mostly to the risk of disability. If a person changes his job to a more risky profession, the insurance company has the right to raise the premiums and change the benefit policy or vice versa if the person changes to a less risky profession. The benefit and premium changes take place as soon as a person changes jobs. Even if the insured doesn't notify the insurer of the job change in advance, changes to the benefit will still take place (up or down accordingly) if disability occurs.

Misstatement of Age

This provision is the same as in life insurance, with a slightly different end result. This provision, in health insurance, allows the insurer to go back and make changes to the benefits so that they match the correct age. This means if a person stated originally that they were younger, the premiums they had been paying were lower than they should have been, and benefits would be adjusted (decreased) accordingly. Conversely, if a person stated originally that they were older than they really were at the time of application, then they would have been paying a higher premium and, therefore, benefits would be adjusted (increased) accordingly.

Other Insurance In This Insurer

There is a maximum amount an insurer is allowed to cover an individual in order to limit the company's risk. A person may occupy more than one policy with an insurer; however, this provision protects the company and does not allow the coverage to exceed a specified amount.

Insurance With Other Insurer

This provision protects the insurance company against over-insurance in case a person has the same coverage from two different insurance policies and only one is notified when "expenses are incurred." This provision states that benefits payable will be prorated and excess premiums will be refunded to the policyowner.

Insurance With Other Insurers

As you can see, this is similar to the above provision. This provision is to allow people to have insurance with more than one company, however, while still avoiding over-insurance. It calls for prorating benefits on any other reason than "expenses incurred," usually in regard to disability income.

Relation of Earnings to Insurance

This has to do with the amount of monies from premium payments the insurer received versus the loss the insurer suffered through claims payments. If disability income benefits from all disability income policies for the same loss exceed the insured's monthly earnings at the time of disability (or the average monthly earnings for two years preceding), the insurer is liable only for that proportionate amount of benefits as the insured's earnings bear to the total benefits under all such coverage.

In Florida, total indemnities payable to the insured may not be reduced below $500 or the sum total benefits under all applicable coverage, whichever is less. Any premiums paid for the excess coverage are refunded.

Unpaid Premiums

When a benefit is payable to the insured or beneficiary, if there are any unpaid premiums they will be deducted at this time.

Cancelation

When the insurance company exercises its right to cancel a policy, the insured must be notified 45 days in advance and must be reimbursed for any prepaid premiums.

Conformity with State Statutes

All conflicts regarding state statutes of the state the insured lives in are automatically adjusted at the time the policy is issued.

Illegal Occupation

If the insured is connected with a felony or has an illegal occupation and incurs injury, the insurance company is not held responsible.

Intoxicants and Narcotics

The insurer is not responsible for any loss that occurs while the insured is intoxicated or under the influence of narcotics unless drugs were administered by a physician.

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Which of the following provisions specifies how long a policyowner’s health coverage will remain in effect if the policyowner does not pay the premium when it is due?

Grace Period

P is a Major Medical policyowner who is hospitalized as a result of injuries sustained from participating in a carjacking. How will the insurer most likely handle this claim?

Claim will be denied

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

What should an insured do if the insurer does not send claims forms within the time period set forth in a health policy’s Claims Forms provision?

Submit the claim in any form

Which of the following statements describes the purpose of the Insuring clause in Health and Accident policies?

States the scope and limits of the coverage

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

Payment of Claims

Which of these is considered a mandatory provision?

Payment of Claims

Which of the following BEST describes a short-term medical expense policy?

Nonrenewable

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

At the policy’s inception

The clause in an Accident and Health policy which defines the benefit amounts the insurer will pay is called the

Insuring clause

Which health policy clause stipulates that an insurance company must attach a copy of the application to the policy to ensure that it is part of the contract?

Entire Contract

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 the

Entire Contract provision

Which of these statements accurately describes the Waiver of Premium provision in an Accident and Health policy?

Premiums are waived after the insured has been totally disabled for a specified time period

What is considered to be a characteristic of a Conditionally Renewable Health Insurance policy?

Premiums may increase at time of renewal

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

Proof of Loss

J, an Accidental Death and Dismemberment (AD&D) policy holder, dies after injuries sustained in an accident. J’s age as stated on the application five years ago was found to be understated by ten 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 insured’s actual age

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 claim’s validity. The provision that limits the time period during which the company may dispute a claim’s validity is called

Time Limit on Certain Defenses

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

S 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

Which of the following statements about a Guaranteed Renewable Health Insurance policy is CORRECT?

Premiums normally increase at time of renewal

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 desribes 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

Which of the following health insurance policy provisions specifies the health care services a policy will provide?

Insuring clause

A Disability Income policyowner 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 5 years prior. The neck injury was never disclosed to the insurer at the time of application. How will the insurer handle this claim?

Claim will be paid and coverage will remain in force

Which of the following statements describes what an Accident and Health policyowner may NOT do?

Adjust the premium payments

In health insurance policies, a waiver of premium provision keeps the coverage in force without premium payments

After an insured has become totally disabled as defined in the policy

The Notice of Claims provision requires a policyowner to

notify an insurer of a claim within a specified tim

With Accidental Death and Dismemberment policies, what is the purpose of the Grace Period?

Gives the policyowner additional time to pay past due premiums

What is the purpose of the Time of Payment of Claims provision?

Prevents delayed claim payments made by the insurer

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 Accident and Health policy provision addresses preexisting conditions?

Time Limit on Certain Defenses

What type of renewability guarantees premium rates and renewability?

Guaranteed renewable

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

excluded by the insurer in the contract provisions

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

An 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

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

An 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 is 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