State RegulationsNY specificDifficulty 2/5
An insurer accepts a premium in connection with the reinstatement of a lapsed individual accident and health policy. Under N.Y. Ins. Law §3216(d)(1)(D), to what period may that premium be applied?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Under N.Y. Ins. Law §3216(d)(1)(D), any premium accepted in connection with a reinstatement must be applied to a period for which premium has not been previously paid, but not to any period more than 60 days prior to the date of reinstatement. The 60-day cap protects insureds from being charged for lapsed time so remote that the insurer had effectively treated it as closed.
Why the other options are wrong
- B) There is a 60-day look-back limit; premiums accepted on reinstatement cannot be applied to periods older than that.
- C) The premium may cover unpaid periods before the reinstatement, up to 60 days; it is not limited to future periods.
- D) Overdue premium plus interest is the life insurance reinstatement requirement; the health provision applies the premium to unpaid periods within the 60-day limit.
Memory hook
Reinstatement premiums reach back only 60 days.