Under the National Association of Insurance Commissioners’ Uniform Individual Accident and Sickness Policy Provisions Law, there are eleven optional uniform provisions that an insurer may add to an individual health insurance policy.1National Association of Insurance Commissioners. Uniform Individual Accident and Sickness Policy Provisions Law – Model 180 Unlike the twelve mandatory provisions, these are not required. But if an insurer uses one, the wording must match the model law or give the policyholder terms at least as favorable.
The eleven optional uniform provisions are:
- Change of Occupation
- Misstatement of Age
- Other Insurance in This Insurer
- Insurance with Other Insurer
- Insurance with Other Insurers
- Relation of Earnings to Insurance
- Unpaid Premium
- Cancellation
- Conformity with State Statutes
- Illegal Occupation
- Intoxicants and Narcotics
Each one addresses a specific risk the insurer may want to manage. Here is what each does.
Change of Occupation
This provision lets the insurer adjust what it pays if you switch to a riskier job after the policy takes effect. If you file a claim while working in a more hazardous occupation than the one on your application, the insurer can reduce your benefit to what your premium would have purchased at the riskier classification.1National Association of Insurance Commissioners. Uniform Individual Accident and Sickness Policy Provisions Law – Model 180 Someone who applied as an office manager and later moved into heavy industrial work, for example, could see a smaller disability payout.
It works the other way too. If you move to a less hazardous job, the insurer owes you a reduced premium going forward or a pro-rata refund of the excess premium paid since you switched.1National Association of Insurance Commissioners. Uniform Individual Accident and Sickness Policy Provisions Law – Model 180
Misstatement of Age
If your age was reported incorrectly on the application, this provision keeps the policy in force but recalculates your benefits. The insurer pays whatever amount your actual premium payments would have bought at your true age. Understate your age, pay less than you should have, and your benefits shrink to match. The adjustment is purely mathematical, and the policy is not voided.
Provisions for Overlapping Coverage
Three separate optional provisions handle situations where you hold more than one policy covering the same type of loss. Each prevents the policyholder from collecting more in benefits than the actual loss, but each targets a different scenario.
Other Insurance in This Insurer
This one caps the total benefits you can collect from a single insurer when you hold multiple policies with the same company. It sets a maximum dollar amount of coverage regardless of how many policies you bought from that insurer. Any premium you paid for coverage above the cap gets refunded.1National Association of Insurance Commissioners. Uniform Individual Accident and Sickness Policy Provisions Law – Model 180
Insurance with Other Insurer
When you hold policies from different companies that reimburse actual medical expenses, and you did not tell the insurer about the other coverage when it accepted the risk, each company pays a proportional share of the claim based on its portion of the total coverage in force. The insurer refunds the excess premium.
Insurance with Other Insurers
A closely related provision applies to policies that pay a flat daily or weekly benefit, such as a hospital indemnity plan, rather than reimbursing specific expenses. If the insurer did not know about your other indemnity coverage, it can reduce its payment on the same proportional basis and refund the extra premium.
The two “other insurer” provisions look similar but use proration methods matched to their benefit type: one for expense-reimbursement policies, one for fixed-dollar indemnity policies.
Relation of Earnings to Insurance
This provision applies to disability income policies. It stops total monthly disability benefits from all your valid coverage combined from exceeding a stated percentage of your actual earnings. The policy typically measures your earnings as the greater of your monthly income when the disability began or your average monthly income over the two years before it started.
If your combined benefits exceed the stated percentage, the insurer reduces its payment accordingly and refunds the excess premium. The provision cannot push combined benefits below a floor amount written into the policy, and it only applies to the loss-of-time benefit, not to other benefits the policy may provide. The point is to discourage over-insurance, where someone collects more while disabled than they earned while working.
Unpaid Premium
Straightforward: the insurer may deduct any overdue premium from the amount it pays on your claim.1National Association of Insurance Commissioners. Uniform Individual Accident and Sickness Policy Provisions Law – Model 180 This commonly comes up when a claim occurs during the grace period, the window after a premium due date when the policy still remains active. Instead of denying the claim for nonpayment, the insurer processes it and subtracts what you owe.
Cancellation
The Cancellation provision gives the insurer the right to terminate your policy by sending written notice to your last known address at least five days before the cancellation takes effect. When the insurer cancels, it must refund the unearned portion of your premium on a pro-rata basis, meaning the money that corresponds to the days of coverage you will no longer receive. Any claim that arose before the cancellation date remains valid.
You can cancel too. If you request cancellation, the refund is typically calculated using a short-rate table, which returns less than the full pro-rata amount to cover the insurer’s administrative costs.
Federal Limits for ACA-Compliant Plans
For health insurance sold in the individual and small-group markets under the Affordable Care Act, federal law sharply limits how an insurer can use this provision. Insurers in those markets must renew or continue coverage at the policyholder’s option.2eCFR. 45 CFR 147.106 – Guaranteed Renewability of Coverage Federal law also prohibits rescission, meaning retroactively canceling coverage, except where the enrollee committed fraud or made an intentional misrepresentation of a material fact.3Office of the Law Revision Counsel. 42 USC 300gg-12 – Prohibition on Rescissions When rescission is allowed, the insurer must give at least 30 days of advance written notice, much longer than the five-day window in the model law.4eCFR. 45 CFR 147.128 – Rules Regarding Rescissions
The traditional Cancellation provision has its greatest practical reach on policies outside ACA regulation: certain supplemental health plans, fixed-indemnity policies, short-term limited-duration plans, and disability income policies.
Conformity with State Statutes
This provision automatically amends any policy term that conflicts with the laws of the state where you live. If a clause is stricter than your state allows, or state law gives you a right the policy does not mention, the policy is treated as if it already matched state law. Neither you nor the insurer has to request a rewrite; the adjustment happens by operation of the provision itself.
This matters because insurance regulation varies widely from state to state. A national insurer may use the same standard policy form in many states, and this provision ensures each policyholder gets at least the protections their state requires.
Illegal Occupation
This provision relieves the insurer of liability for any loss to which a contributing cause was committing or attempting to commit a felony, or being engaged in an illegal occupation.1National Association of Insurance Commissioners. Uniform Individual Accident and Sickness Policy Provisions Law – Model 180 The threshold is a felony, not just any legal violation; a minor traffic infraction would not trigger it. The illegal activity need only be a contributing cause of the loss, not the sole cause.
Intoxicants and Narcotics
This provision lets the insurer deny a claim for any loss sustained while you were under the influence of alcohol or a narcotic, unless the substance was taken as prescribed by a physician.1National Association of Insurance Commissioners. Uniform Individual Accident and Sickness Policy Provisions Law – Model 180 The prescription exception matters: an injury after taking a legitimately prescribed opioid painkiller would not fall under this exclusion.
State laws differ on these two exclusions. Some permit them as written; others restrict or ban them. Where state law conflicts, the Conformity with State Statutes provision overrides the exclusion.
How These Interact with the Mandatory Provisions
The twelve mandatory provisions in every individual accident and sickness policy set baseline protections that optional provisions cannot override. One of them, the Time Limit on Certain Defenses (sometimes called the incontestability provision), limits how long an insurer can use a misstatement in your application to void the policy or deny a claim. After the contestability period, typically two or three years depending on the state, that door closes unless the misstatement was fraudulent. Optional provisions like Misstatement of Age and Change of Occupation can still adjust the benefit amount after that point, because they modify what the policy pays rather than void the policy entirely.