Question 51

An insurance company may NOT terminate coverage on a group member if the member becomes disabled.

Under the Guaranteed Renewable provision, an insurance company is required to continue coverage for a group member who becomes disabled, ensuring that they remain protected despite their change in health status.

A) ceases to fall within the eligible classification

If a group member ceases to fall within the eligible classification, the insurance company may terminate their coverage. This option is incorrect as it does not align with the stipulations of the Guaranteed Renewable provision, which protects members against loss of coverage due to disability.

B) ceases to be actively employed

Coverage can be terminated if a member is no longer actively employed, as their eligibility is directly tied to their employment status. Therefore, this option is also incorrect in the context of the Guaranteed Renewable provision.

C) reaches the age specified in the policy

When a member reaches the age specified in the policy, the insurance company may terminate coverage based on age limits set forth in the policy. This makes this option incorrect, as it does not reflect the protections offered under the Guaranteed Renewable provision for disabled members.

D) becomes disabled

This option is correct because the Guaranteed Renewable provision explicitly states that an insurance company cannot terminate coverage for a member who becomes disabled. This is a critical protection for individuals who may need continued insurance support due to their health condition.

Conclusion

The correct answer is D, as it highlights the essential protection provided under the Guaranteed Renewable provision for disabled members. Options A, B, and C fail to recognize the specific circumstances under which an insurance company can terminate coverage, thus demonstrating that only option D aligns with the core concept of guaranteed renewability in insurance policies.