State RegulationsMI specificDifficulty 3/5
A Michigan policyholder replaces his Medicare supplement policy with a new policy from a different insurer. The new policy contains a 6-month preexisting-condition waiting period, and he had already satisfied 2 months under the old policy. How must the new insurer treat the waiting period?
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
M.C.L. 500.3825 provides that a Medicare supplement policy may not waive preexisting-condition time limits applicable to the policy being replaced. Unlike Michigan's long-term care replacement rule, which requires crediting of satisfied periods, Medicare supplement replacement carries no waiver or credit: the new policy's preexisting time limits apply as written.
Why the other options are wrong
- A) Waiving the period entirely is exactly what M.C.L. 500.3825 forbids for Medicare supplement replacements.
- C) The producer's identity is irrelevant; the statute allows no reduction of the preexisting limits on replacement.
- D) No credit for time satisfied under the replaced policy is required or permitted under M.C.L. 500.3825.
Memory hook
Med supp replacement: the preexisting clock starts fresh, no waiver, no credit.