State RegulationsNY specificDifficulty 2/5
A Manhattan insured's individual health policy has a monthly premium that came due last week and remains unpaid. She now submits a covered claim. What may the insurer do under the unpaid premium provision?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Under N.Y. Ins. Law §3216(d)(2)(G), when a claim becomes payable, any premium then due and unpaid may be deducted from the claim payment. The insured's coverage is honored, since the policy remains in force during grace under §3216(d)(1)(C), and the insurer collects the arrears without a separate collection effort.
Why the other options are wrong
- A) The provision exists precisely so that a past-due premium does not bar the claim.
- B) There is no deferral mechanism; the claim is paid net of the premium.
- C) The netting is a deduction from benefits, not a loan to be repaid.
Memory hook
Claim check minus the past-due premium.