Free Individual Accident and Health Provisions Study Guide
Hawaii Accident & Health exam — Individual Accident and Health Provisions.
Hawaii writes the uniform individual health policy provisions into statute. The required provisions are in HRS 431:10A-105 and the optional provisions in HRS 431:10A-106. They follow the traditional NAIC uniform provisions closely, but several Hawaii versions differ from the current NAIC model, so learn Hawaii's wording and numbers. The national guide explains each provision's purpose and the renewability classes (noncancelable, guaranteed renewable, conditionally renewable, optionally renewable).
Required provisions (HRS 431:10A-105)
| Provision | Hawaii rule |
|---|---|
| Entire contract | The policy, endorsements and any attached papers are the whole agreement |
| Time limit on certain defenses | After three years from the issue date, only fraudulent misstatements in the application can be used to void the policy or deny a claim. Preexisting conditions not excluded by name are also covered after three years |
| Grace period | 7 days for weekly-premium policies, 10 days for monthly, 31 days for all others |
| Reinstatement | If the insurer issues a conditional receipt with a reinstatement application and does not act, the policy is reinstated on the 45th day. A reinstated policy covers accidents after reinstatement and sickness beginning more than 10 days after it |
| Notice of claim | Written notice within 20 days after the loss begins, or as soon as reasonably possible |
| Claim forms | The insurer furnishes forms within 15 days of notice. If it doesn't, the claimant may send proof of loss in any written form |
| Proof of loss | Within 90 days after the loss. Late proof is accepted if given as soon as reasonably possible, and no later than 15 months after it was due (unless the claimant lacked legal capacity) |
| Time of payment of claims | Benefits are paid promptly after proof of loss |
| Payment of claims | Benefits go to the insured or the named beneficiary. Under an optional clause, up to $2,000 may go to a relative who is equitably entitled when benefits are payable to an estate or a minor |
| Physical examination and autopsy | At the insurer's expense, while a claim is pending. An autopsy is allowed where the law permits |
| Legal actions | No lawsuit until 60 days after proof of loss, and none after three years from when proof was required |
| Change of beneficiary | Belongs to the insured unless the designation is irrevocable. The beneficiary's consent is not needed |
Optional provisions (HRS 431:10A-106)
- Change of occupation: benefits or premiums are adjusted for a more or less hazardous job. A move to a less hazardous job, once proven, brings a premium reduction and a refund of the excess.
- Misstatement of age: benefits are adjusted to what the premium would have bought at the correct age.
- Relation of earnings to insurance: benefits may be cut when total loss-of-time coverage exceeds earnings. Total monthly benefits may not drop below the lesser of $200 or the sum of the monthly benefits.
- Intoxicants and narcotics: Hawaii keeps this optional exclusion. It covers losses sustained while intoxicated or under a narcotic not taken on a doctor's advice.
- Cancellation: Hawaii still lists cancellation among its optional provisions, although the current NAIC model has dropped it. The insurer must give at least five days' written notice and refunds unearned premium pro rata. If the insured cancels, the insurer keeps earned premium figured on the short-rate table.
Free look and other Hawaii policy rules
- Free look: 10 days after receipt for individual accident and health policies, with a premium refund (HRS 431:10-214). Single-premium nonrenewable and travel accident policies are exempt.
- Representations: statements in the application are representations, not warranties. A misrepresentation defeats recovery only if made with intent to deceive or if it is material to the risk (HRS 431:10-209).
- Delivery: the policy is mailed or delivered within a reasonable time after issue (HRS 431:10-225).
- Newborns are covered from birth (31-day notice if premium is due). Adult children may stay on until 26. A disabled dependent child stays covered past the limiting age with proof within 31 days (HRS 431:10A-115, 10A-141, 10-212).
Prompt pay (HRS 431:13-108)
- Clean claims are paid within 30 days (paper) or 15 days (electronic).
- Notice of a contested or denied claim is due within 15 days (paper) or 7 days (electronic).
- Late payments earn 15% a year in interest.
Common exam traps
- The time limit on certain defenses in Hawaii is three years, not two.
- Grace periods are 7, 10 or 31 days depending on how often premium is paid.
- After reinstatement, sickness is covered only if it begins more than 10 days later. A pending reinstatement is approved automatically on day 45.
- Notice of claim is due in 20 days, claim forms in 15, proof of loss in 90 (with an outside limit of 15 months).
- No lawsuit for 60 days after proof, and none after 3 years.
- Hawaii's optional cancellation clause uses 5 days' notice, with a pro rata refund when the insurer cancels and short-rate when the insured cancels.
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Practice questions are study aids generated for exam preparation and are not actual exam questions. Content is provided for educational purposes and is not legal advice. Verify current statutes, rules, and exam specifications with the Insurance Department and the exam administrator before relying on it.
