Health · Chapter 18 · Exclusions & Limits
Pre-Existing Condition Provision
Definition
Excludes coverage for conditions that existed before the policy's effective date — even if the applicant didn't know about them. For DISCLOSED conditions the insurer may: deny the application, charge more, permanently exclude the condition at standard premium, or deem it minor and cover it from day one (or apply the standard exclusion). Subject to the time limit on certain defenses; the waiting period generally can't exceed 12 months. Purpose: protect the insurer from adverse selection. (Applies to policies not governed by the ACA.)
Example
Marcus discloses mild asthma. The insurer can deny, rate up, exclude asthma permanently, cover it day one, or apply a 12-month exclusion.
Exam tip
It protects against adverse selection and applies even if the insured was unaware of the condition.
Easy to confuse with
These are what this term gets tested against — if you can't tell them apart cold, drill the contrast.
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