State RegulationsNY specificDifficulty 2/5
A policyowner in Albany asks what is required to reinstate her lapsed New York life policy. Which combination correctly states the statutory requirements?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Under N.Y. Ins. Law §3203(a)(10), reinstatement requires evidence of insurability as the insurer may reasonably require, payment of all overdue premiums, and interest not exceeding 6% per annum compounded annually. All elements must be satisfied within 3 years of the date of default, and the original policy — not a new contract — is restored.
Why the other options are wrong
- A) Evidence of insurability may be required as the insurer reasonably requires under §3203(a)(10); it is not barred by statute.
- B) There is no new policy fee; reinstatement restores the original contract rather than issuing a new one.
- D) Future premiums are not prepaid on reinstatement; only overdue premiums plus interest are due.
Memory hook
Reinstatement trio: insurability + overdue premiums + capped interest.