An older policyholder with advancing cognitive impairment unintentionally lets a long-term care policy lapse. Under the unintentional-lapse protections of 31 Pa. Code 89a.106, which outcome is consistent with Pennsylvania's approach?
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Pennsylvania's unintentional-lapse rule, 31 Pa. Code 89a.106, recognizes that a policyholder — particularly one whose capacity is declining — may lose coverage by oversight at the very moment the protection matters most. The regulation therefore requires protective procedures before a lapse defeats coverage, including notice to designated parties and the opportunity to restore or continue the policy, rather than allowing an automatic forfeiture. The Pennsylvania Insurance Department designed the rule so that cognitive impairment and oversight do not convert years of premiums into nothing.
Why the other options are wrong
- A) The grace-period ending does not by itself finalize the loss; the unintentional-lapse protections of 31 Pa. Code 89a.106 operate after that point.
- B) The federal Medicare program does not replace long-term care coverage and does not cure a lapse under Pennsylvania's regulation.
- C) Forcing the policyholder back through new underwriting as a first-time applicant defeats the purpose of the unintentional-lapse protections.
Memory hook
Forgetfulness is not forfeiture: Pennsylvania builds a safety net under a lapsed LTC policy.