New Jersey Life and Health State Practice Exam

What is the grace period for health insurance premium payments?

1. 5 days

2. 10 days

3. 30 days

4. 15 days

The correct answer is: 10 days

In the context of health insurance, the grace period is a specific time frame following the due date of a premium payment during which the policyholder can make their payment without losing coverage. This is an important consumer protection that ensures individuals do not lose their health insurance immediately upon missing a payment. In New Jersey, the standard grace period for health insurance premium payments is indeed 30 days. During this period, the insurer cannot cancel the policy for non-payment, allowing the policyholder time to make the payment and maintain their coverage. After this grace period, if the premium is still unpaid, the insurance company may proceed to terminate the policy. The other options do not align with the regulations established for grace periods in health insurance contexts. A grace period of 5, 10, or 15 days is too short and does not meet the standards necessary to protect consumers adequately, which is why the 30-day grace period is critical for both consumer rights and maintaining continuous health coverage.