Health policy uniform provisions, with the Texas numbers

The uniform provisions are the most memorization-heavy part of the general section. Texas codifies them word for word in TIC Chapter 1201, so every number below is also Texas law.

Questions and answers, explained

All 12 questions above, with the correct answer and why it is correct. Everything here is on health policy uniform provisions, with the texas numbers.

1. Under the entire contract provision of an individual health policy, who has authority to change the policy or waive any of its provisions?

   • AThe insured, by sending a signed letter to the insurer's home office
   • BAn executive officer of the insurer, with the change endorsed on or attached to the policyCorrect
   • CAny licensed agent appointed by the insurer in the insured's state
   • DThe agent who sold the policy, as long as the change is explained to the insured in writing

   Why: The required entire contract provision (TIC 1201.207) says the policy, endorsements and attached papers are the whole contract, that a change is valid only when approved by an executive officer and endorsed on or attached to the policy, and that no agent has authority to change the policy or waive its provisions.

   Reference TIC 1201.207 — Texas outline VI.A.1

2. An individual health policy has been in force for three years. The insurer discovers an innocent misstatement on the application. Under the time limit on certain defenses provision, the insurer:

   • AMay void the policy only within five years of issue
   • BMay reduce all future benefits by half for the rest of the policy's life
   • CCannot use it to void the policy or deny a claim for a loss beginning after the second anniversaryCorrect
   • DMay void the policy at any time, because every misstatement is a ground for rescission

   Why: The time limit on certain defenses provision (TIC 1201.208) bars using a misstatement, other than a fraudulent one, to void the policy or deny a claim for a loss or disability beginning after the second anniversary of issue. It also bars denying such a claim because a condition not excluded by name existed before coverage began.

   Reference TIC 1201.208 — Texas outline VI.A.2

3. What is the minimum grace period for an individual health policy whose premium is paid monthly?

   • A10 daysCorrect
   • B7 days
   • C60 days
   • D31 days

   Why: The grace period provision (TIC 1201.209) requires at least 7 days for a weekly premium policy, 10 days for a monthly premium policy, and 31 days for any other policy. The policy stays in force during the grace period.

   Reference TIC 1201.209 — Texas outline VI.A.3

4. Rosa pays her individual health premium annually. How long is the minimum grace period on her policy?

   • A10 days
   • BOne full year
   • C7 days
   • D31 daysCorrect

   Why: Under TIC 1201.209 the grace period must be at least 31 days for any policy that is not on a weekly (7 days) or monthly (10 days) premium, which includes quarterly, semiannual and annual premiums.

   Reference TIC 1201.209 — Texas outline VI.A.3

5. A lapsed health policy is reinstated after the insurer approves an application for reinstatement. For which losses does the reinstated policy cover the insured?

   • AAccidents only, with sickness excluded for the first full year after reinstatement
   • BAccidents after reinstatement, and sickness that begins more than 10 days after itCorrect
   • CSickness at once, but accidents only after a 30-day waiting period
   • DAny loss during the lapse, as long as overdue premium is paid with interest

   Why: The reinstatement provision (TIC 1201.210) covers only loss from an accidental injury sustained after reinstatement and loss due to sickness beginning more than 10 days after reinstatement. The 10-day wait guards against people reinstating only after they fall ill.

   Reference TIC 1201.210 — Texas outline VI.A.4

6. The insurer requires a reinstatement application and issues a conditional receipt for the premium. It neither approves nor disapproves the application in writing. When is the policy reinstated?

   • AOn the 45th day after the date of the conditional receiptCorrect
   • BOn the 31st day, at the end of the grace period that applied before the lapse
   • CNever; silence by the insurer means the application is denied
   • DOn the 10th day after the receipt, once sickness coverage would begin

   Why: Under TIC 1201.210, if the insurer requires a reinstatement application and gives a conditional receipt, the policy is reinstated on approval or, if not approved, on the 45th day after the receipt unless the insurer has notified the insured in writing of disapproval before then. Accepting the premium without requiring an application reinstates the policy immediately.

   Reference TIC 1201.210 — Texas outline VI.A.4

7. Under the notice of claim provision, written notice of a claim should be given to the insurer within how many days after a covered loss begins, or as soon as reasonably possible?

   • A60 days
   • B5 days
   • C20 daysCorrect
   • D90 days

   Why: TIC 1201.211 requires written notice of claim before the 21st day after the loss occurs or begins (that is, within 20 days), or as soon after as is reasonably possible. Notice to an authorized agent with enough information to identify the insured counts as notice to the insurer.

   Reference TIC 1201.211 — Texas outline VI.A.5

8. After receiving notice of a claim, an insurer fails to send claim forms within 15 days. What may the claimant do?

   • ACancel the policy and demand a refund of every premium ever paid
   • BNothing; the claim cannot proceed until the insurer's official form arrives
   • CSue immediately for double the claim amount plus all court costs
   • DSubmit written proof of the occurrence, character and extent of the loss, which then satisfies proof of lossCorrect

   Why: The claim forms provision (TIC 1201.212) requires the insurer to furnish its usual claim forms on receiving notice. If they are not furnished before the 16th day after notice, the claimant complies with the proof-of-loss requirement by submitting, within the proof-of-loss time limit, written proof covering the occurrence, character and extent of the loss.

   Reference TIC 1201.212 — Texas outline VI.A.6

9. Under the proof of loss provision, written proof for a non-periodic loss should be filed within 90 days. If that was not reasonably possible, what is the latest it may be filed, absent legal incapacity?

   • ATwo years after the policy's next anniversary date
   • BOne year after the proof was otherwise dueCorrect
   • CThere is no outer limit once the delay is explained
   • DSix months after the date of the loss itself

   Why: TIC 1201.213 requires proof of loss before the 91st day after the loss (or after the end of the period of liability for periodic payments). A late proof does not reduce the claim if timely proof was not reasonably possible, but it must be furnished as soon as reasonably possible and, except for legal incapacity, no later than one year after it was otherwise due.

   Reference TIC 1201.213 — Texas outline VI.A.7

10. A disability income policy pays periodic benefits. Under the time of payment of claims provision, how often at minimum must accrued benefits be paid once proof is received?

    • AAt least once every three months
    • BOnce a year, on the policy anniversary
    • COnly in a lump sum when the disability ends
    • DAt least monthlyCorrect

    Why: The time of payment of claims provision (TIC 1201.214) requires non-periodic benefits to be paid immediately on receipt of due proof, and periodic benefits at intervals no less frequent than monthly, with any balance paid immediately when liability ends.

    Reference TIC 1201.214 — Texas outline VI.A.8

11. Under the payment of claims provision, an accidental death benefit is payable to the named beneficiary. If no beneficiary designation is in effect, to whom is it paid?

    • AThe insured's estateCorrect
    • BThe state's unclaimed property fund
    • CThe insured's employer
    • DThe agent of record

    Why: Under TIC 1201.215, indemnity for loss of life is paid according to the beneficiary designation in effect; if none is in effect it is payable to the insured's estate. All other benefits are payable to the insured.

    Reference TIC 1201.215 — Texas outline VI.A.9

12. While a disability claim is pending, the insurer asks the insured to see a physician it chooses. Under the physical examination and autopsy provision, who pays for the exam?

    • AThe insured and insurer, split equally
    • BThe insured
    • CThe insurerCorrect
    • DThe insured's primary care physician

    Why: TIC 1201.216 gives the insurer, at its own expense, the right to examine the insured as often as it reasonably requires while a claim is pending and, in case of death, to require an autopsy where not forbidden by law.

    Reference TIC 1201.216 — Texas outline VI.A.10

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