State RegulationsNY specificDifficulty 2/5
Under Reg 145, which of the following is a recognized reason for which a New York insurer may refuse to renew a small employer's group medical coverage?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Under Reg 145 (11 NYCRR Part 360.2(e)), renewability does not protect a small employer that fails to pay premiums; nonpayment of premiums is a recognized ground for refusing renewal, as is fraud or intentional misrepresentation. Health status, claims experience, and ordinary workforce changes are not grounds to refuse renewal of small employer coverage.
Why the other options are wrong
- A) Deteriorating employee health is never a permitted ground for refusing renewal.
- B) Claims running above premiums is a business result the insurer accepts when it enters the small group market, not a ground to non-renew.
- D) Hiring new employees is a normal change that does not defeat the employer's renewal rights.
Memory hook
Skip the premium, lose the renewal: nonpayment or fraud breaks the deal.