Mandatory provisions I: entire contract, incontestability, grace period, reinstatement

Correct answer: The policy, including its endorsements and any attached papers

The entire contract provision says the policy, including endorsements and attached papers, is the entire contract. Nothing outside it can add to or change its terms.

Correct answer: Approval by an executive officer of the insurer, endorsed on or attached to the policy

A change is valid only if an executive officer of the insurer approves it and the approval is endorsed on or attached to the policy.

Correct answer: The exclusion applies, because the agent had no authority to waive a policy provision

No agent has authority to change the policy or waive any of its provisions. The policy, with its endorsements and attached papers, is the entire contract, so the written exclusion controls.

Correct answer: No agent has authority to change the policy or to waive any of its provisions

The entire contract; changes provision states that no agent has authority to change the policy or waive any of its provisions. Only an executive officer's approval, endorsed on or attached to the policy, can change it.

Correct answer: It is decided under the policy, which contains no vision benefit

The entire contract provision limits the contract to the policy, its endorsements and attached papers. A brochure is none of these, so the claim is decided under the policy as written.

Correct answer: So that buyers get the same basic protections no matter which insurer writes the policy

The mandatory uniform provisions give every buyer of an individual health policy the same basic contractual protections, whichever insurer writes the policy.

Correct answer: No, because an approved change must also be endorsed on or attached to the policy

A change requires both approval by an executive officer and endorsement on, or attachment to, the policy. Without the endorsement the change is not part of the entire contract.

Correct answer: Grace period and reinstatement

The grace period keeps the policy in force while a late renewal premium is paid, and reinstatement revives a policy that has lapsed. Entire contract and the time limit on certain defenses concern the contract's terms and the application.

Correct answer: 2 years

The time limit on certain defenses allows the insurer to use application misstatements for 2 years from the date of issue. After that, only fraudulent misstatements remain available.

Correct answer: A fraudulent misstatement

The time limit on certain defenses bars the use of misstatements after 2 years except fraudulent misstatements. Fraud remains a defense.

Correct answer: Nothing based on the misstatement; it cannot void the policy or deny the claim

The misstatement was innocent and the policy has been in force more than 2 years, and the disability began after the 2-year period. The time limit on certain defenses bars the insurer from using it.

Correct answer: It does not protect the insured, because fraudulent misstatements are excepted

The time limit on certain defenses bars non-fraudulent misstatements after 2 years, but it excepts fraudulent misstatements. Deliberate concealment is fraud, so the insurer may still contest.

Correct answer: Only if the policy excluded that condition by name or specific description

Under the time limit on certain defenses, after 2 years no claim can be reduced or denied because a condition existed before the effective date unless the policy excluded it by name or specific description.

Correct answer: Yes, because the condition was excluded by specific description

The time limit on certain defenses protects against denial for preexisting conditions after 2 years unless the condition was excluded by name or specific description. This one was.

Correct answer: The health provision keeps the insurer's right to contest fraudulent misstatements after the period ends

A life policy's incontestable clause, once it runs, usually bars even a fraud defense. The standard health time limit on certain defenses excepts fraudulent misstatements, so fraud remains contestable.

Correct answer: It may still contest based on the misstatement, because the 2-year period has not run

The time limit on certain defenses bars non-fraudulent misstatements only after the policy has been in force 2 years. At 18 months, the insurer may still use the misstatement.

Correct answer: After 2 years in force, the policy becomes incontestable as to statements in the application

A noncancellable or guaranteed renewable policy may state that after 2 years in force, not counting periods of disability, it becomes incontestable as to the statements in the application.

Correct answer: After 2 years in force not counting the 6 months of disability, so about 2 years and 6 months after issue

Under the alternative wording, the policy becomes incontestable after it has been in force 2 years excluding any period during which the insured is disabled. Six months of disability pushes the date to about 2 years and 6 months after issue.

Correct answer: Time limit on certain defenses

In health insurance, the provision limiting how long the insurer can use application misstatements is called the time limit on certain defenses.

Correct answer: 10 days

Fla. Stat. § 627.608 requires a grace period of not less than 10 days for a monthly premium policy.

Correct answer: 7 days

Fla. Stat. § 627.608 requires a grace period of not less than 7 days for a weekly premium policy.

Correct answer: 31 days

Fla. Stat. § 627.608 requires a grace period of not less than 31 days for all policies other than weekly or monthly premium policies.

Correct answer: It stays in force

Florida's required wording states that during the grace period the policy will stay in force (Fla. Stat. § 627.608).

Correct answer: No, because the grace period applies only to renewal premiums, not the first premium

The grace period covers a renewal premium not paid on or before its due date (Fla. Stat. § 627.608). It does not apply to the first premium.

Correct answer: No, because the notice of nonrenewal was given at least 30 days before the due date

Where the insurer reserves the right to refuse renewal, the grace period does not apply if the insurer delivered or mailed written notice of nonrenewal at least 30 days before the due date (Fla. Stat. § 627.608(1)).

Correct answer: The grace period still applies, because the notice was not given at least 30 days in advance

The nonrenewal exception in Fla. Stat. § 627.608(1) applies only when notice is delivered or mailed at least 30 days before the due date. Notice 20 days in advance is too late, so the grace period still applies.

Correct answer: Yes, because the policy stays in force during the 31-day grace period

A quarterly premium policy has a grace period of at least 31 days, and the policy stays in force during it (Fla. Stat. § 627.608). March 20 is within the grace period.

Correct answer: A monthly-premium health policy must allow at least 10 days, while a life policy must allow at least 30 days

Fla. Stat. § 627.608 sets health minimums of 7 (weekly), 10 (monthly) and 31 (all other) days, while § 627.453 requires a life insurance grace period of not less than 30 days.

Correct answer: The policy lapses

If the grace period ends without payment, the policy lapses. Reinstatement is the mechanism for bringing it back.

Correct answer: The policy is reinstated

Under the reinstatement provision, acceptance of the premium by the insurer, or by an agent authorized to accept it, without requiring an application reinstates the policy.

Correct answer: On the 45th day after the date of the conditional receipt

If an application is required and a conditional receipt is issued, the policy is reinstated on approval or, lacking prior written disapproval, on the 45th day after the receipt date.

Correct answer: No, because the insurer disapproved the application before the 45th day

Automatic reinstatement on the 45th day applies only if the insurer has not previously notified the insured in writing of disapproval. Disapproval on May 30, before the 45th day, prevents reinstatement.

Correct answer: More than 10 days after the reinstatement date

A reinstated policy covers sickness only if it begins more than 10 days after the reinstatement date.

Correct answer: No, because sickness is covered only if it begins more than 10 days after reinstatement

After reinstatement, sickness is covered only if it begins more than 10 days after the reinstatement date. June 5 is within those 10 days.

Correct answer: Yes, because accidental injury sustained after the reinstatement date is covered

A reinstated policy covers accidental injury sustained after the reinstatement date. The 10-day waiting rule applies only to sickness.

Correct answer: 60 days

Under the reinstatement provision, premiums accepted on reinstatement may be applied to a period for which premium was not previously paid, but not to any period more than 60 days before the reinstatement date.

Correct answer: Yes, because the sickness began more than 10 days after reinstatement

A reinstated policy covers sickness that begins more than 10 days after the reinstatement date. September 15 is 14 days after September 1.

Correct answer: To keep someone from reinstating a lapsed policy only after an illness has already started

The 10-day sickness rule protects the insurer against adverse selection: an insured who lets a policy lapse should not be able to reinstate only once an illness is already under way. Accidents, which cannot be anticipated, are covered immediately after reinstatement.

Correct answer: No, because the policy was reinstated on April 15 and the sickness began only 5 days later

With no disapproval, the policy was reinstated on the 45th day after the March 1 receipt, April 15. Sickness is covered only if it begins more than 10 days after reinstatement; April 20 is only 5 days later.

Correct answer: The same rights they had before the lapse, subject to any provisions endorsed in connection with the reinstatement

Under the reinstatement provision, the insured and the insurer have the same rights as before the policy lapsed, subject to any provisions endorsed on or attached to the policy in connection with the reinstatement.