Accident & Sickness Policy Provisions Flashcard

Front

What constitutes the entire contract in an insurance policy?

Back

Policy, application, and riders

Answer explanation

The entire contract in an insurance policy includes the policy document, the application submitted by the insured, and any riders that modify the coverage. Therefore, the correct answer is 'Policy, application, and riders'.

Front

After how many years can an insurer not void a policy for misstatements, except in cases of fraud?

Back

2 years

Answer explanation

An insurer cannot void a policy for misstatements after 2 years, except in cases of fraud. This means that if a policyholder makes a misstatement, the insurer has a 2-year window to contest the policy.

Front

What is the purpose of a grace period in an insurance policy?

Back

To provide extra time to pay premiums without lapse

Answer explanation

The purpose of a grace period in an insurance policy is to provide extra time to pay premiums without lapse, ensuring that the policy remains active even if the payment is delayed.

Front

What must an insured do within a set time after a loss occurs?

Back

Notify the insurer of the loss

Answer explanation

After a loss occurs, the insured must notify the insurer of the loss within a specified time frame. This is crucial for the claims process to begin and ensures that the insurer can assess the situation promptly.

Front

What is required from the insurer after receiving a notice of claim?

Back

Send claim forms within a set time

Answer explanation

After receiving a notice of claim, the insurer is required to send claim forms within a set time. This ensures the claims process is initiated properly, unlike the other options which are not standard procedures.

Front

What happens if there is a misstatement of age or gender in an insurance policy?

Back

Benefits are adjusted to the correct amount

Answer explanation

If there is a misstatement of age or gender in an insurance policy, benefits are adjusted to the correct amount based on the accurate information, rather than canceling the policy or refunding premiums.

Front

Effect of a change of occupation on insurance benefits?

Back

Benefits are adjusted based on the new occupation risk

Answer explanation

A change of occupation can affect insurance benefits, as they are adjusted based on the risk associated with the new occupation. Higher risk jobs may lead to increased premiums or reduced benefits.

Front

What is the purpose of a probationary period in an insurance policy?

Back

To delay the start of certain coverages

Answer explanation

The purpose of a probationary period in an insurance policy is to delay the start of certain coverages, allowing insurers to assess risk before full coverage is activated.

Front

What does a waiver of premium provision entail?

Back

Premiums are waived during total disability after a waiting period

Answer explanation

A waiver of premium provision means that if the policyholder becomes totally disabled, their premiums will be waived after a specified waiting period, ensuring they maintain coverage without financial burden.

Front

What is the purpose of preauthorizations in an insurance policy?

Back

To approve certain services before they are provided

Answer explanation

Preauthorizations are required by insurance policies to approve certain services before they are provided, ensuring that the treatment is necessary and covered under the policy.