A producer is preparing to replace a client's existing individual health policy with a newly offered one. Under Va. Code § 38.2-3514, which consideration about pre-existing conditions should shape the producer's recommendation?
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Why B is correct
Va. Code § 38.2-3514 addresses pre-existing conditions in the context of replacing health insurance: the considerations exist precisely because a replacement can reset how the new insurer treats conditions the insured already has. A new contract may treat previously covered conditions under its own pre-existing provisions, and any lapse between policies can create a period without coverage. The producer must weigh credit for the prior coverage and continuity of protection — not just price — before recommending replacement, consistent with the duties Virginia imposes on those marketing health coverage.
Why the other options are wrong
- A) A new insurer does not automatically inherit the old policy's benefit schedule; pre-existing history matters precisely because the new contract stands on its own terms.
- C) No calendar-year rule erases pre-existing-condition considerations; the analysis turns on the insured's treatment history and the new contract's terms.
- D) A lower premium alone is not a sound replacement basis; the pre-existing-condition consequences of switching are a required consideration under Va. Code § 38.2-3514.
Memory hook
Before you replace, ask what starts over: new pre-existing clocks and coverage gaps.