What is the definition of Guaranteed Renewable Policy?

Guaranteed Renewable Policy refers to a policy where, as long as the premiums are paid on time, the insured person does not need to show proof of insurability until he reaches a certain age.

The insurance company is obligated to renew the policy (usually a health policy), as specified in the contract. It cannot cancel the policy, regardless of the losses that policy is incurring or whether there are adverse changes in the situation of the insured that makes him a less attractive risk to insure.

The insurance company cannot make changes to the terms and provisions in the individual health policy. When it does need to make changes on the premium rates, it has to do so for all the insured persons who fall in that same class.

The insured person has the option to renew the insurance, until he reaches a specified age (such as his 70^th year).

• Insolvency
• Misstatement of Age or Sex Provision
• Modified Premium Policies
• Moral Hazard
• Comprehensive Coverage