AD Banker Comprehensive Practice Exam

Under what circumstances do major medical policies usually provide for restoration of benefits?

1. Restoration usually occurs after a specified dollar amount of benefits has been exhausted and after the insured has proven insurability

2. Restoration of benefits must occur every policy anniversary regardless of the amount of benefits exhausted

3. Anytime benefit limits have been exhausted

4. Under no circumstances do major medical policies provide restoration of benefits

The correct answer is: Restoration usually occurs after a specified dollar amount of benefits has been exhausted and after the insured has proven insurability

Major medical policies typically include provisions for the restoration of benefits under specific conditions, which helps to ensure that policyholders can maintain coverage over the long term. The correct answer states that restoration usually occurs after a specified dollar amount of benefits has been exhausted and after the insured has proven insurability. This means that once the policyholder has utilized a predetermined limit of benefits, they may be eligible to have those benefits restored, assuming that they can demonstrate insurability. This often involves undergoing a review of their health status to determine if they still qualify for coverage based on the insurance company's underwriting criteria. This provision allows for the continuity of benefits for individuals who may require ongoing medical care, while also protecting the insurer from having to restore benefits for individuals who have experienced significant changes in their health that would affect risk. The other choices present scenarios that do not align with standard practices for major medical policies, either suggesting mandatory annual restoration regardless of benefit usage or stating that benefits are never restored, which is not typically how these policies are designed.