An insurer may terminate an individual medical expense policy for which of the following reasons?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Nonpayment of premium is the classic, universally permitted ground for terminating an individual medical expense policy. Under federal rules, an insurer may not rescind coverage after a claim except for fraud or intentional misrepresentation, and it may not cancel a policy simply because the insured's health worsens or because a covered claim was filed. Changing physicians is an ordinary member activity that cannot trigger termination. The right-to-terminate provisions in the A&H outline therefore focus on nonpayment and on statutorily permitted rescission grounds, not on the insured's medical history or utilization of benefits.
Why the other options are wrong
- B) Filing a valid covered claim is protected conduct and cannot be a ground for termination.
- C) Deteriorating health after issue cannot justify cancellation; that risk is what the policy covers.
- D) Choosing a different doctor is a normal member decision and does not affect the policy's validity.
Memory hook
Nonpayment ends the policy; filing a claim or a health scare does not.