State RegulationsNY specificDifficulty 2/5
An insured under a New York individual accident and health policy is injured while taking part in a criminal enterprise. The policy contains the standard illegal occupation provision. What may the insurer do?
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Under N.Y. Ins. Law §3216(d)(2)(J), a New York individual accident and health policy may provide that the insurer is not liable for any loss sustained in consequence of the insured's being engaged in an illegal occupation. Because the injury occurred during participation in a criminal enterprise, that specific loss falls within the exclusion and may be denied on that basis.
Why the other options are wrong
- A) The exclusion turns on the conduct and its connection to the loss, not on a prior record or conviction.
- B) The provision is a claim exclusion, not a cancellation trigger; the policy itself is not automatically terminated.
- C) It operates claim by claim on losses tied to the illegal occupation, not as a blanket forfeiture of all future benefits.
Memory hook
Illegal occupation: that loss is out; the policy itself lives on.