The renewal provision that allows continued coverage but with premium changes is called

• A. Conditionally renewable
• B. Nonrenewable
• C. Noncancellable
• D. Guaranteed renewable policy

Answer: (D)

The concept tested is how renewal provisions handle continued coverage and premium adjustments. A guaranteed renewable policy means the insurer must renew the coverage at each renewal date, so the contract continues. However, premiums can be increased at renewal, typically based on factors like age or policy class, not canceled or dropped simply because of those changes. This is what allows continued coverage with premium changes.

Other options don’t fit: a conditionally renewable policy can renew only under certain conditions; a nonrenewable policy cannot be renewed once it ends; a noncancellable policy prevents premium increases for the life of the policy. Only the guaranteed renewable arrangement guarantees renewal while allowing premium changes.