Medical Expense✓ Verified · outline & fact-checked · Sep 2026Difficulty 2/5
A guaranteed renewable individual health policy allows the insurer to:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Under guaranteed renewability, the insurer must continue the policy in force as long as premiums are paid, and it may not cancel the policy because of an insured's deteriorating health or claims. Premium increases are permitted, but they must be class-wide rate adjustments that apply to all policies in the same rate class, not individualized increases based on one insured's claims. This renewability standard is tested under the contract and benefit-structure provisions of AH-III.A.1d, where candidates must compare it with cancellable and optionally renewable contracts.
Why the other options are wrong
- B) Guaranteed renewable contracts cannot be cancelled without cause; that is the definition of a cancellable policy.
- C) Refusing renewal based on claim history would defeat the guarantee, which protects renewal regardless of health.
- D) Premiums may change only by class, never by singling out one insured's loss experience.
Memory hook
Guaranteed renewable = renewed no matter what, but the whole class can be repriced.