An insured lets an individual accident and sickness policy lapse, then submits a reinstatement application with the overdue premium and a conditional receipt. The insurer does not act on the application. Under Va. Code § 38.2-3503(A), what happens?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
The reinstatement provision required by Va. Code § 38.2-3503(A) prevents an insurer from sitting on a reinstatement application indefinitely: if the insured has applied and paid, the policy reinstates automatically on the 45th day after the conditional receipt is mailed, unless the insurer has already reinstated it earlier. The automatic date protects the insured, who may assume coverage is in force on day 45 if no action has been taken. This is why the Virginia Bureau of Insurance treats reinstatement timing as a fixed required-provision rule rather than a matter of insurer discretion.
Why the other options are wrong
- A) Silence for 10 days does not amount to a denial; the statutory default is automatic reinstatement on the 45th day.
- B) Affirmative insurer approval is not required; the statute supplies an automatic reinstatement date.
- C) The automatic date is the 45th day, not the 10th — the 10-day figure belongs to other required provisions.
Memory hook
Conditional receipt mailed, silence follows: coverage revives itself on day 45.