What provision allows an insurer to deduct unpaid insurance premiums from a claim payment?

The correct answer refers to a provision that specifically addresses the situation where an insurer can deduct unpaid premiums from any claim payment. This provision allows the insurer to ensure that they are compensated for any premiums that have not been paid by the policyholder before the claim can be fully settled.

By including this provision, the insurer protects itself from financial loss related to unpaid premiums while still addressing the claims made by the policyholder. This is a common practice in insurance agreements, ensuring that policyholders are aware of their financial responsibilities even at the time of making a claim. Ultimately, it establishes a clear connection between the status of premium payments and the insurer’s obligation to pay claims.

In contrast, the other choices do not specifically define the allowance to deduct unpaid premiums from claims. The claims provision generally refers to the terms and conditions under which claims are processed, while the late payment provision typically relates to the consequences of not paying premiums on time, without specifically addressing deduction from claim payments. The claim adjustment provision deals with altering or settling the amount of a claim itself but does not include stipulations regarding past due premiums.