State RegulationsTX specificDifficulty 1/5
Under the Texas Medicare supplement rule governing cancellation, which of the following is a permissible ground for an insurer to cancel a Medicare supplement policy that is in force?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Under 28 TAC 3.3306(E), cancellation of an in-force Medicare supplement policy is confined to the grounds stated in the rule, with nonpayment of premium being the standard example. The practical consequence is that cancellation cannot be used as a disguised response to claims experience: a Texas policyowner who gets sicker, files more claims, or grows older cannot be cancelled out of the policy on that basis.
Why the other options are wrong
- A) Claims experience above the insurer's projection is not a lawful ground to cancel an in-force Medicare supplement policy.
- B) Advanced age is not a cancellation ground, and Medicare supplement coverage is not terminated because the insured grows older.
- C) Deteriorating health is not a permitted cancellation ground; the rule is aimed at preventing exactly this kind of cancellation.
Memory hook
Nonpayment cancels a Medigap policy; getting older and getting sick do not.