Florida 2-15 Life, Health and Variable Annuity AgentFlorida Laws and Regulations Specific to Health InsuranceEasy
A Florida resident is reviewing their individual health insurance policy and notices a provision that allows the insurer to refuse renewal only on a statewide basis, affecting all policies of the same class. What type of renewability provision is this?
- AGuaranteed Renewable
- BConditionally Renewable
- CNon-cancellable
- DOptionally Renewable
Show answer & explanationAnswer & explanation
Correct answer: D. Optionally Renewable
Optionally renewable policies allow the insurer to refuse renewal for any reason, but often require that the refusal apply to all policies of a similar class in a given area, preventing discrimination.
Why the other options are wrong
- A. Guaranteed renewable policies allow renewal up to a certain age, with the insurer only able to increase premiums by class.
- B. Conditionally renewable policies allow the insurer to refuse renewal under certain conditions specified in the policy, not just statewide class conditions.
- C. Non-cancellable policies guarantee renewal and prohibit the insurer from changing premium rates.
Optionally Renewable
A health insurance policy provision that allows the insurer to refuse renewal for any reason, but typically only on a class basis for all policies of the same type in a given geographic area.
- Insurer can refuse renewal.
- Refusal usually applies to an entire class of policies.
- Premiums can be increased by class.
Memory trick: GRaNt COnditions Often Don't Cancel