Health Insurance Policy Provisions
Mandatory provisions
Individual health policies must include the uniform provisions: entire contract; a time limit on certain defenses (typically two years, after which misstatements in the application cannot be used to deny a claim except for fraud); a grace period (about 7 days for weekly, 10 for monthly, 31 for other modes); reinstatement; claim notice and proof of loss (usually 90 days); time of payment of claims; physical examination and autopsy at the insurer's expense; legal actions barred before 60 days after proof and after the limitations period (usually 3 years); misstatement of age; change of occupation; and conformity with state law.
Renewability and disability income
Renewability answers who can cancel and on what terms: cancellable (either party, any time), optionally renewable, conditionally renewable, guaranteed renewable (insurer cannot cancel but can raise premiums by class), and noncancellable (rate and renewal guaranteed). Disability income adds an elimination period, a benefit period, own-occupation versus any-occupation definitions, residual or partial disability, presumptive disability, and the relation-of-earnings clause that caps benefits against prior income.
Traps
Match timing numbers to the correct provision - the two-year limit on defenses is not the three-year legal-action limit. Do not confuse elimination period (waiting before benefits) with benefit period (how long benefits last). In managed care, precertification and concurrent review affect payment, not eligibility.
ACA overlay
No lifetime or annual dollar limits on essential health benefits, preventive services without cost sharing, dependent coverage to age 26, internal and external appeals, and required coverage of essential health benefits. Vermont adds community rating and guaranteed issue in its merged market.
Rule of thumb
When asked how long the insurer has to pay after proof of loss, the time-of-payment provision controls - often immediately, but no later than 60 days.