State RegulationsOH specificDifficulty 1/5
An insured filing a covered A&H claim has one overdue premium. Under the optional unpaid premium provision, how is this handled?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
ORC 3923.05 authorizes the optional unpaid premium provision for Ohio individual accident and sickness policies. When a claim becomes payable, the insurer deducts any premium that is due and unpaid from the benefit settlement, so the insured receives the net amount. This keeps the claim process moving without a separate collection step, and the Ohio Department of Insurance lists it among the permissive provisions an insurer may, but need not, include.
Why the other options are wrong
- B) Denial of the claim is far too drastic; the provision's entire purpose is to settle the premium debt out of the benefit payment.
- C) The provision does not forgive the premium; it recovers it through a deduction from the payable benefits.
- D) Retroactive lapse is not the remedy; under ORC 3923.05 the policy's benefits simply fund the overdue premium.
Memory hook
Claim day is premium catch-up day.