Flashcards in Health Insurance - Individual Policy Provisions Deck (37):
Twelve Required Insurance Contract Provisions
1.) Entire Contract Provision;
2.) Time Limit on Certain Defenses (Incontestability) Provision;
3.) Grace Period Provision;
4.) Reinstatement Provision;
5.) Physical Exam. & Autopsy Provision;
6.) Legal Actions Provision;
7.) Change of Beneficiary Provision;
8.) Payment of Claims Provision;
9.) Notice of Claim Provision;
10.) Claim Forms Provision;
11.) Proof of Loss Provision;
12.) Time Payment of Claim Provision
Entire Contract Provision
Health insurance policy provision that state the policy makes up the entire contract.
Time Limit on Certain Defenses Provision
Health insurance policy provision that limits the time an insurer can void a contract or deny a claim for material misrepresentation on an application. Typically, this time frame equals two or three years.
Grace Period Provision
Health insurance policy provision that allows the policy holder limited time beyond the due date to pay a premium. 7-day grace period for premiums paid weekly. 10-day grace period for premiums paid monthly. 31-day grace period for all other payment modes.
Modes of Premium Payment
The frequency of premium payment (e.g., weekly, monthly, quarterly, semiannually, annually, or some other frequency).
Health insurance provision that lets the policy owner place a lapsed policy back in force within a certain period (typically three years).
Physical Examination & Autopsy Provision
Health insurance provision that allows the insurer to require the insured to take a physical exam or be subject to an autopsy during the claims investigation process. Paid for by the insurer.
Legal Action Provision
Health insurance provision that defines the periods during which the insured can take legal action against the insurer because it didn't pay a claim. Normally, there is a waiting period of 60 days after proof of a claim is submitted to an insurer before legal action can be taken for non-payment of a claim.
Change of Beneficiary Provision
Health insurance provision that applies to policies that provide a death benefit and a beneficiary has been designated.
Payment of Claim Provision
Health insurance provision that details how claims are paid out.
Notice of Claim Provision
Health insurance provision that requires the insured to notify the insurer within 20 days after he or she has a covered loss.
Claim Forms Provision
Health insurance provision that an insurer must provide claims forms to the insured within 15 days of receiving a notice of claim.
Proof of Loss Provision
Health insurance provision that requires the insured to provide written proof of loss within 90 days of the loss.
Time Payment of Claim Provision
Health insurance provision that requires insurers to pay claims immediately after receiving proof of loss. The meaning of the term "immediately" ranges from 45 days to 60 days.
Change of Occupation Provision
Optional health insurance provision that allows for premium change if an insured individual changes to a more or less hazardous occupation.
Misstatement of Age Provision
Optional health insurance provision that highlights how the misstatement of one's age on an application impacts benefits received. Some states have made this provision mandatory.
Other Insurance in this Insurer Provision
Optional health insurance provision that limits the total coverage the the insurance company assumes with one insured.
Insurance with Other Insurer Provision
Optional health insurance provision that addresses situations where an insured has coverage for the same risk and expenses with multiple insurance companies and has not notified the other insurance companies.
Other Insurance with Other Insurers Provision
Optional health insurance provision that extends the ability for insurers to prorate the benefit they pay when the primary insurer had prior knowledge of other insurers.
Relation-of-Earnings to Insurance Provision
Optional disability insurance provision that reduces the policy's income benefit if the insured has more insurance benefit income than actual income at the time of disability.
Unpaid Premium Provision
Optional health insurance provision that addresses any premiums the insured may not have paid at the time of the claim, usually allowing the insurer ti credit the benefits it pays toward premiums due.
Optional health insurance provision that provides an insurer the ability to cancel, not renew or change the premium for a policy by giving the insured a 45-day notice. If the cancellation is the result of the insured not paying the premium, the notification period drops to 10 days.
Conformity with State Statutes Provision
Optional health insurance provision that addresses policy provisions that differ from state law and therefore are automatically changed to meet the minimum requirements of the law.
Illegal Occupation Provision
Optional health insurance provision that allows the insurer to deny liability when the insured's claim arises from the insured's participation in an illegal activity.
Intoxicants and Narcotics Provision
Optional health insurance provision that allows the insurer to deny liability when the insured's claim arises from the insured's intoxication or use of narcotic drugs.
Component of the Insurance with Other Insurer health insurance provision that allows an insurer to prorate the amount of benefit it will pay if another insurer is covering losses from the same event.
Allows a policy owner to return he policy to the insurer within a limited time and receive a full refund of premiums and fees paid.
States the insurer's promise to pay a specified amount of benefit if a certain event occurs.
States the consideration terms. The applicant's consideration in the health insurance contract is the application and the first premium payment. The insurance company's consideration is the promise to pay a benefit when a stated future event occurs.
The period that must pass between the policy's effective date and the time when illness-related losses will be covered.
The waiting period after a loss occurs before benefits begin.
Waiver of Premium Provision
Provides that the policy's premium will be waived if the insured is disabled.
Defines the rights of the insurer to increase premiums or cancel a policy, as well ass the rights of the policy owner's right to renew the policy's coverage beyond the current coverage period.
A renewability provision in a health insurance policy under which the insurer guarantees that during the noncancellable period, it will not end the policy, nor will it increase the premium.
A renewability provision in a health insurance policy under which the insurer guarantees that, during the guaranteed renewal period, it will not cancel the policy, and it will increase premiums only on a class basis.
A renewability provision in a health insurance policy under which the insurer guarantees that the policy owner can renew the coverage, if the conditions of the policy are met.