State RegulationsPA specificDifficulty 2/5
A Pennsylvania producer is helping a client replace her existing individual health insurance policy with a new one from another insurer. What does Pennsylvania replacement law require in this situation?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Pennsylvania's health replacement rules — 31 Pa. Code 88.101 through 31 Pa. Code 88.103 — impose duties on producers and insurers when an individual health policy is being replaced. The producer must provide the required replacement notices and disclosures, and the insurers involved learn of the replacement so the existing carrier can protect the client's interests. The process exists to curb twisting of health coverage and is overseen by the Pennsylvania Insurance Department.
Why the other options are wrong
- B) Replacement is exactly the event Pennsylvania regulates; proceeding without the required notices violates the replacement procedures.
- C) The procedures contemplate notice to the existing insurer as well; silence until after termination defeats the rule's protective purpose.
- D) An employer's permission is irrelevant to replacing an individually owned health policy; the Pennsylvania replacement procedures are what apply.
Memory hook
Replace = notify: both carriers, required notices, no quiet switching.