An insured submits a $300 claim for medical expenses. The insurer notes that the insured has a past due premium of $100, and as a result, the insurer only pays $200. • Which of the following General Policy Provisions covers this situation?
The situation described falls under theunpaid premiumgeneral policy provision as outlined in Pennsylvania Accident and Health Insurance regulations. This provision allows an insurer to deduct anypast-due premiumfrom claim payments before issuing benefits to the insured. In the given example, the insured submits a $300 claim, but because $100 in premiums is overdue, the insurer lawfully reduces the payment to $200.
Pennsylvania-approved insurance study guides explain that the unpaid premium provision protects insurers from paying claims when premiums have not been fully maintained, while still honoring coverage in force. This provision applies only when coverage remains active and the policy has not lapsed.
The other options are incorrect. The payment of claims provision explains how and when claims are paid, not deductions for unpaid premiums. Renewability addresses continuation of coverage. Payment actions is not a recognized general policy provision. Therefore,unpaid premiumis the correct and verified answer according to Pennsylvania Life, Accident, and Health Insurance policy standards.
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