Texas Life & Health Insurance Exam — All Questions

Under the Uniform Provisions Law, the 'time limit on certain defenses' (incontestability) provision in an individual health policy generally prevents the insurer, after the policy has been in force for a stated period, from:

• a.Ever raising premiums on the class of policyholders
• b.Requiring proof of loss for a claim
• c.Denying a claim based on misstatements in the application (except fraudulent ones, where permitted)✓
• d.Paying benefits on time

The time-limit-on-certain-defenses (incontestability) provision bars the insurer, after the policy has been in force for a set period (often two or three years), from voiding the policy or denying a claim because of misstatements made in the application, with an exception for fraudulent misstatements where state law allows. It does not restrict the insurer's right to adjust premiums for a whole class, nor does it eliminate the routine requirement that the insured submit proof of loss. Paying benefits on time is required by a separate provision (time of payment of claims), not this one.

A 'pre-existing condition' provision in a health policy generally allows the insurer to:

• a.Limit or exclude coverage for a condition the insured had before the policy took effect, for a stated period✓
• b.Cancel the policy whenever the insured files any claim
• c.Refuse to ever pay for accidents
• d.Increase the death benefit for prior illnesses

A pre-existing condition provision lets the insurer limit or exclude benefits for a medical condition that existed (was diagnosed or treated, or would have prompted a prudent person to seek care) before the policy's effective date, typically for a defined waiting period after which the condition is covered. It is not a general right to cancel the policy upon any claim, and it does not let the insurer refuse all accident coverage. Health policies pay medical or disability benefits, not a death benefit, so the last option is inapplicable.