How can misstatement of age affect an existing medical expense policy?

• A. The insurer may adjust benefits or premiums based on corrected age, potentially retroactively.
• B. It has no effect once the policy is issued.
• C. It always leads to cancellation of the policy.
• D. It only affects the deductible.

Answer: (A)

Misstatement of age in a medical expense policy triggers adjustments because age determines both how much premium is charged and what benefits are available. When the insurer learns the true age, they can set benefits and premiums as if that corrected age had been used from the start. That means benefits may change to reflect the right risk level, and premiums can be recalculated accordingly, sometimes applying retroactively to the policy’s effective date or to the date the error was discovered. This ensures the pricing and coverage stay fair and accurate given the insured’s actual age.

That’s why the other options don’t fit: simply having a policy in force doesn’t mean there’s no effect; most misstatements don’t automatically cancel the policy; and the impact isn’t limited to the deductible—benefits and premiums are the main areas adjusted.