Question

Which of the following statements describes what an Accident and Health policy owner may NOT do?

a) Surrender the policy
b) Choose the beneficiary
c) Transfer the policy
d) Change policy riders

Answer 1

An Accident and Health policy owner may NOT transfer the policy due to underwriting assumptions being specific to the individual. Surrendering the policy, choosing a beneficiary, and changing policy riders are usually permitted actions for the policyholder.

Step-by-step explanation:

The statement that describes what an Accident and Health policy owner may NOT do is c) Transfer the policy. Generally, Accident and Health policies are non-transferable because they are underwritten with the assumption that the risk is specific to the individual policyholder. Transferring the policy could alter the risk profile, which is not typically allowed by the insurance company. On the other hand, policyholders are usually able to surrender the policy, they can choose the beneficiary, and often they are given the flexibility to change policy riders, subject to the terms and conditions of the policy itself.