State RegulationsIL specificDifficulty 2/5
An Illinois insurer wants to issue an individual disability income policy that pays benefits above the levels specified in the Illinois minimum-standards regulation. Under Illinois law, the insurer:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
50 Ill. Adm. Code 2007 prescribes minimum benefit standards for individual accident and health policies, which operate as floors. An insurer is free to issue an individual policy with richer benefits than the standards require; what is prohibited is falling below the standards or including unfair, misleading, or deceptive provisions. No written variance is needed to exceed the standards, and moving the product into the separately regulated group market would be irrelevant to the question of richer individual benefits.
Why the other options are wrong
- B) The standards are minimums, not maximum caps; above-standard benefits are permitted under 50 Ill. Adm. Code 2007.
- C) No written variance from the Director of Insurance is required to offer benefits exceeding the Illinois minimums.
- D) The group market has its own separate regulation, and there is no rule forcing richer benefits into group forms.
Memory hook
Above the floor is always allowed; no permission slip needed.