PSI Ohio Insurance Practice Exam

What does an impairment rider specify in an insurance policy?

1. Additional premium charges

2. Exclusions for certain conditions

3. Policy renewal terms

4. Claim submission deadlines

The correct answer is: Exclusions for certain conditions

An impairment rider in an insurance policy specifically outlines exclusions for certain pre-existing conditions or impairments that may affect the policyholder's coverage. This rider is typically attached to a health or life insurance policy when the insurer determines that the insured has a condition that significantly increases risk. By including an impairment rider, the insurer clarifies which specific health issues will not be covered, defining the boundaries of the policy's coverage. The presence of an impairment rider informs the insured about limitations related to their existing health status, allowing them to be aware of any gaps in coverage. This is crucial for both the insurer and the insured, as it helps manage expectations regarding what is financially protected under the policy. Other options, such as additional premium charges, policy renewal terms, or claim submission deadlines, do not specifically address the nature of an impairment rider and its function within the context of pre-existing conditions in the insured's health profile.