Free Individual Accident and Health Provisions Study Guide
Tennessee Life, Accident & Health exam — Individual Accident and Health Provisions.
Tennessee codifies the uniform individual accident and sickness provisions in Tenn. Code Ann. 56-26-108 (required) and 56-26-109 (optional). Tennessee's optional list still includes a cancellation provision. Current NAIC Model 180 doesn't, so be ready for Tennessee questions about it. The general concepts are in the national Individual A&H Provisions guide.
Free look and policy labels
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An individual A&H policy may be returned within 10 days of delivery for a refund, for any reason. The policy is then void from the beginning (56-26-129).
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Renewability labels must appear on the face of the policy:
- "POLICY CANCELLABLE BY COMPANY" on a cancellable policy (56-26-125)
- "RENEWABLE AT OPTION OF COMPANY" when the insurer can refuse renewal (56-26-126)
These label rules don't apply to group or franchise policies (56-26-127).
Required provisions (56-26-108)
| Provision | Tennessee rule |
|---|---|
| Entire contract | The policy and the attached application are the entire contract. |
| Time limit on certain defenses | After 2 years from issue, non-fraudulent misstatements can't be used to void the policy or deny a claim. |
| Grace period | 7 days for weekly premiums, 10 days for monthly, 31 days for all other modes. |
| Reinstatement | If an application is required, the policy is reinstated on approval or on the 45th day after the conditional receipt. Accidents are covered right away. Sickness is covered only if it begins more than 10 days later. Premium may be applied back no more than 60 days before reinstatement. |
| Notice of claim | Within 20 days after the loss, or as soon as reasonably possible. |
| Claim forms | Due within 15 days of notice. If they're late, written proof in any form is enough. |
| Proof of loss | Within 90 days. Late proof is accepted if given as soon as reasonably possible, but no later than 1 year after it was due unless the claimant lacked legal capacity. |
| Time of payment | Immediately on proof. Periodic benefits are paid at least monthly. |
| Payment of claims | May include a facility-of-payment clause of up to $1,000 to a relative the insurer considers entitled. |
| Physical exam and autopsy | At the insurer's expense, as often as reasonably required. Autopsy where the law allows. |
| Legal actions | No suit until 60 days after proof of loss. No suit later than 3 years after proof was required. |
Optional provisions (56-26-109)
| Provision | Tennessee rule |
|---|---|
| Change of occupation | A riskier job reduces benefits to what the premium buys. A safer job lowers the rate and the excess premium is refunded. |
| Misstatement of age | Benefits are adjusted to what the premium buys at the true age. |
| Relation of earnings to insurance | If total loss-of-time coverage exceeds earnings, benefits are prorated and the excess premium is refunded, subject to a $200 floor. |
| Unpaid premium | Premium that's due and unpaid may be deducted from a claim. |
| Cancellation | The insurer may cancel on 5 days' written notice and refund pro rata. If the insured cancels, the refund is short-rate. |
| Illegal occupation | Excludes losses where a felony, an attempted felony or an illegal occupation contributed. |
Lapse notice (56-7-2303)
- For noncancellable or guaranteed renewable A&H policies, and for life policies, owned by Tennessee residents, the insurer mails a lapse notice stating:
- the amount due
- where to pay it
- that the policy will lapse if it isn't paid
- Not covered: group, industrial, employer-billed, and monthly-or-more-frequent premium policies.
Common exam traps
- Grace periods: 7 / 10 / 31 days.
- Notice of claim: 20 days. Claim forms: 15 days. Proof of loss: 90 days, with a 1-year outer limit.
- Lawsuits: no sooner than 60 days after proof and no later than 3 years after proof was required.
- If the insurer cancels, the refund is pro rata. If the insured cancels, it's short-rate.
- The free look is 10 days, and the policy is void from the start.
Practice Individual Accident and Health Provisions questions All Life, Accident & Health topics
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.
