HEALTH INSURANCE POLICY PROVISIONS, CLAUSES, AND RIDERS

What is the initial requirement for an insured to become eligible for benefits under the Waiver of Premium provision?

1. Insured must be under a physician's care

2. Insured must be unemployed

3. Insured must be hospitalized

4. Insured must demonstrate financial need

Insured must be under a physician's care

What type of rider would be added to an Accident and Health policy if the policyowner wants to ensure the policy will continue if he/she ever becomes totally disabled?

1. Disability Income rider

2. Guaranteed Insurability rider

3. Waiver of Premium rider

4. Accidental Death and Dismemberment rider

Waiver of Premium rider

A producer does not have the authority to change a policy or waive any of its provisions. The health provision that best describes this statement is called the

1. Entire Contract

2. Incontestable

3. Time Limit on Certain Defenses

4. Grace Period

Entire Contract

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

1. Noncancellable

2. Guaranteed renewable

3. Conditionally renewable

4. Nonrenewable

Nonrenewable

According to the Mandatory Uniform Policy Provisions, what is the maximum amount of time after the premium due date during which the policy remains in force even though the premium has not been paid?

1. 31 days

2. 10 days

3. 60 days

4. 7 days

31 days

Which of the following is NOT included in the policy face?

1. Free Look provision

2. Exclusions

3. Name of the insured

4. Name of the insurer

Exclusions

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

1. Free-look provision

2. Consideration clause

3. Contestable clause

4. Insuring clause

Insuring clause

Under an individual Health Insurance policy, the Time Limit of Certain Defenses provision states that nonfraudulent misstatements first become incontestable two years

1. from the date that the policy was issued

2. from the date initial premium was collected

3. from the date of the sales appointment

4. from the date that the application was signed

from the date that the policy was issued

Which of the following policy provisions prohibits an insurance company from incorporating external documents into an insurance policy?

1. Incontestable

2. Waiver

3. Exceptions and Reductions

4. Entire Contract

Entire Contract

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

1. Premiums may increase at time of renewal

2. Policy may be renewed at the discretion of the insured

3. Premiums may increase at any time

4. Policy may be amended by insurer at any time

Premiums may increase at time of renewal

An insurance company normally has 2 years to contest information provided on an accident and health application. This 2 year period begins on the date that the:

1. the first premium is paid

2. producer completes the application

3. insurer dates the policy

4. medical examination is given

insurer dates the policy

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

1. Cancel the coverage

2. Adjust the premium payments

3. Assign ownership

4. File a covered claim

Adjust the premium payments

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

1. 5

2. 20

3. 10

4. 15

15

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

1. Past due premiums on a lapsed policy are waived and coverage is restored

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

3. The insured is paid a monthly benefit to keep insurance premiums current in the event of total disability

4. Premiums are waived after the insured has been unemployed for a specified time period

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

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:

1. Insuring clause

2. Entire Contract provision

3. Time Limit on Certain Defense provision

4. Legal Contract clause

Entire Contract provision

K 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:

1. guaranteed renewable

2. noncancellable

3. optionally renewable

4. conditionally renewable

guaranteed renewable

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 placed back in force?

1. 30 days

2. 60 days

3. 45 days

4. 10 days

45 days

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

1. When a covered loss occurs

2. When a claim is submitted

3. At the policy's inception

4. 30 days after the policy's inception

At the policy's inception

With Optionally Renewable Health policies, the insurer may:

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

2. renew the policy only with the insured's consent

3. review the policy whenever they please and determine whether or not to renew it

4. renew the policy only if no claims have been filed the previous year

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?

1. Consideration clause

2. Usual, Customary, and Reasonable clause

3. Insuring clause

4. Benefit clause

Insuring clause

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?

1. Reinstatement

2. Waiver of Premium

3. Consideration

4. Grace Period

Grace Period

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:

1. 16-Oct

2. 21-Sep

3. 1-Nov

4. 1-Dec

1-Nov

Which of these is considered a mandatory provision?

1. Payment of Claims

2. Change of Occupation

3. Insurance with Other Insurers

4. Misstatement of Age

Payment of Claims

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

1. Gives the policyowner additional time to file a lawsuit

2. Gives the policyowner additional time to provide proof of loss

3. Gives the policyowner additional time to file a claim

4. Gives the policyowner additional time to pay overdue premiums

Gives the policyowner additional time to pay overdue premiums

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

1. Relation of earnings to insurance provision

2. Change of occupation provision

3. Conformity of state statutes provision

4. Entire contract provisions

Change of occupation provision

The Legal Actions provision of an insurance contract is designed to do all of the following, EXCEPT:

1. protect the insured from having claim research delayed

2. protect the producer

3. provide the insurer adequate time to research a claim

4. give the insured guidelines for pursuing legal action against and insurer

protect the producer

A Disability Income policy that only the policyowner can terminate and which the rates will never go up is considered to be

1. Guaranteed Renewable

2. Noncancellable

3. Cancellable

4. Optionally Renewable

Noncancellable

An insured must notify an insurer of a medical claim within ___ days after an accident.

1. 20

2. 40

3. 10

4. 30

20

The sections of an insurance contract which limit coverage are called:

1. riders

2. limitations

3. exclusions

4. waivers

exclusions

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?

1. The reinsurer

2. The insured

3. The insurer

4. The Guaranty Association

The insured

If an individual is covered under an Accidental Death Policy and dies, an autopsy can be performed in all these situations, EXCEPT:

1. When the cause of death is unknown

2. When consent for the autopsy is not obtained

3. When the state prohibits this by law

4. When foul play was a contributing factor

When the state prohibits this by law

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?

1. The insurer will deny the claim and refund premiums paid

2. The insurer will pay the original face amount minus any premium deficiencies owed

3. The insurer will pay the original benefit stated in the policy

4. The insurer will adjust the benefit to what the premiums paid would have purchased at the insured's actual age

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

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

1. Proof of Claim

2. Proof of Loss

3. Proof of Payment

4. Proof of Coverage

Proof of Loss

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?

1. Reinstatement

2. Free-look

3. Consideration

4. Grace Period

Reinstatement

What type of renewability guarantees premium rates and renewability?

1. Noncancellable

2. Optionally renewable

3. Warrantied renewable

4. Conditionally renewable

Noncancellable

Which Accident and Health policy provision addresses preexisting conditions?

1. Proof of Loss

2. Payment of Claims

3. Legal Actions

4. Time Limit on Certain Defenses

Time Limit on Certain Defenses

T applied for a Disability Income policy and has a history of back injuries. The insurer issued the policy with a statement that excludes coverage for back injuries. This statement is called a(n)

1. rating

2. impairment rider

3. encumbrance

4. back exclusion

impairment rider

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:

1. Grace Period

2. Insuring

3. Time Limit on Certain Defenses

4. Free-look

Time Limit on Certain Defenses

Which of the following statements BEST describes what the Legal Actions provision of an Accident and Health policy requires?

1. An insured must settle a claim within 30 days after Proof of Loss is submitted

2. An insured must settle a claim within 60 days after Proof of Loss is submitted

3. An insured must wait at least 30 days after Proof of Loss has been submitted before a lawsuit can be filed

4. An insured must wait at least 60 days after Proof of Loss has been submitted before a lawsuit can be filed

An insured must wait at least 60 days after Proof of Loss has been submitted before a lawsuit can be filed

T owns an Accident & 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?

1. Increase her policy's coverage amount

2. Allow her to take a tax deduction on unearned premiums

3. Nothing

4. Decrease her policy's coverage amount

Increase her policy's coverage amount

The insuring clause

1. Prohibits the insured from suing the insurer for at least 60 days after filing a written proof of loss

2. States the scope and limits of the coverage

3. States the amount of premium to be collected

4. Specifies the additional time given to pay past due premiums

States the scope and limits of the coverage

The Notice of Claims provision requires a policyowner to:

1. notify their physician of a claim within a specified time

2. notify an insurer of a claim within a specified time

3. provide proof of loss to an insurer within a specified time

4. wait 60 days after filing a claim to initiate a lawsuit against an insurer

notify an insurer of a claim within a specified time

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?

1. Noncancellable

2. Guaranteed Renewable

3. Conditionally Renewable

4. Optionally Renewable

Guaranteed Renewable

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

1. File a lawsuit

2. Nothing

3. Contact the insurer again requesting forms

4. File written proof of loss

File written proof of loss

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

1. Protects the insurer from frivolous lawsuits

2. Prevents delayed claim payments made by the insurer

3. Requires the insured to wait 60 days after submitting Proof of Loss before filing a lawsuit

4. Requires a probation period for each claim filed by the insured

Prevents delayed claim payments made by the insurer

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

1. Annually

2. Quarterly

3. Monthly

4. Semiannually

Monthly

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?

1. Wait for the claim form to arrive

2. Resubmit the request for a claim form

3. Submit the claim in any form

4. File a lawsuit

Submit the claim in any form

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?

1. Consideration

2. Insuring

3. Entire Contract

4. Free-look

Entire Contract

Which of the following is considered to be the time period after a Health Policy is issued, during which no benefits are provided for illness?

1. Incontestable Period

2. Subrogation Period

3. Probationary Period

4. Trial Period

Probationary Period

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

1. Policy can renewed at any time by the company

2. Premiums normally decrease at time of renewal

3. Policy can be cancelled at any time by the company

4. Premiums normally increase at time of renewal

Premiums normally increase at time of renewal

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?

1. MIB clause

2. Entire Contract clause

3. Consideration clause

4. Insuring clause

Consideration clause

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?

1. 10

2. 31

3. 7

4. 20

31

C is the policyowner of a Comprehensive individual Major Medical policy. C pays an annual premium which is due September 1. If C forgets to pay the premium and is hospitalized September 10, how will the insurer handle this claim?

1. Cancel the policy and deny the claim

2. Deny the claim

3. Pay the claim in full minus the premium due

4. Pay half the claim and keep remaining balance until premium is paid

Pay the claim in full minus the premium due

X is insured with a Disability Income policy that provides coverage until age 65. This policy allows the insurer to change the premium rate for the overall risk class assigned. Which of these renewability features does this policy contain?

1. Guaranteed Assignable

2. Noncancellable

3. Optionally Cancellable

4. Guaranteed Renewable

Guaranteed Renewable

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

1. Following an accidental injury, but not during sickness

2. During the time an insured is confined in a hospital

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

4. Whenever an insured is unable to work

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

Which health policy clause specifies the amount of benefits to be paid?

1. Free-look

2. Consideration

3. Insuring

4. Payment mode

Insuring

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?

1. Claim will be denied and policy terminated

2. Claim will be partially paid

3. Claim will be denied

4. Claim will be paid

Claim will be denied

S is the policyowner of a Major Medical policy. The premiums are paid monthly and due on the 1st of each month. S fails to make September's payment and is hospitalized October 15th. When S files the claim for this hospitalization, the insurer will likely

1. pay half the claim

2. pay the claim minus September and October's premium payments

3. deny the claim

4. pay the full claim

deny the claim

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

1. Insuring

2. Benefit

3. Payment

4. Identification

Insuring

The insured and insurance company will share the cost of covered losses under which health policy feature?

1. Assignment provision

2. Subrogation clause

3. Payment of Claims provision

4. Share clause

Payment of Claims provision

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?

1. Claim will be denied and coverage will be cancelled

2. Claim will be denied, the coverage cancelled, and all premiums paid will be refunded

3. Claim will be paid and coverage will remain in force

4. Claim will be denied and coverage will remain in force

Claim will be paid and coverage will remain in force

A(n) ___________ of benefits of a Health Policy transfers payments to someone other than the policyowner.

1. assignment

2. designation

3. allocation

4. transfer

assignment

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

1. charged a higher premium

2. given a longer probationary period

3. assigned to a reinsurer

4. excluded by the insurer in the contract provisions

excluded by the insurer in the contract provisions

The policy provision that entitles the insurer to establish conditions the insured must meet while a claim is pending is:

1. Time Limit on Certain Defenses

2. Grace Period

3. Entire Contract

4. Physical Examination and Autopsy

Time Limit on Certain Defenses

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

1. Payment of Claims

2. Entire Contract

3. Proof of Loss

4. Claim Forms

Payment of Claims

Under a Guaranteed Renewable health insurance policy, the insurer

1. may refuse to continue coverage upon policy renewal

2. will typically decrease the premium upon policy renewal

3. is permitted to require proof of insurability upon policy renewal

4. may cancel the policy for nonpayment only

may cancel the policy for nonpayment only

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:

1. cancellable

2. guaranteed renewable

3. noncancellable

4. conditionally renewable

noncancellable

Insurers may request a hearing within ____ if their policy is rejected

1. 30 Days

2. 20 Days

3. 60 Days

4. 90 Days

20 Days

Periodic health claim payments MUST be made at least:

1. monthly

2. weekly

3. annually

4. daily

monthly

T sends proof of loss to her insurer for an acceptable medical expense claim under her individual Health Insurance policy. Upon receipt, the insurer must pay the benefits

1. immediately

2. within 6 months

3. within 3 months

4. at the insurer's discretion

immediately