Certified Financial Consultant (CFC) Practice Exam

What would happen if an insured forgot to pay their Major Medical Insurance premium and then had an accident shortly after?

1. Pay the claim

2. Refuse the claim

3. Delay the claim

4. Cancel the policy

The correct answer is: Pay the claim

In the context of Major Medical Insurance, if an insured forgets to pay their premium, it is essential to understand the implications of that lapse in payment. Usually, insurers have a grace period during which a policyholder can make a payment after the premium due date without facing immediate loss of coverage. During this grace period, the insured is still considered active, and any accidents or medical issues that occur would typically be covered by the policy. If the accident happens during that grace period, the insurance company would generally pay the claim, as the policyholder had not formally lost their coverage yet. Thus, the correct answer reflects the situation where the insured's coverage is still intact despite their oversight in premium payment during the grace period. If the insured were to miss the payment deadline without having a grace period or if the policy had lapsed, then the other options could become relevant, leading to claim refusal or policy cancellation. However, as long as coverage is active, the claim would be honored.