In which scenario might evidence of insurability be required?

In the context of insurance, evidence of insurability is often required to determine an individual's or entity's eligibility for coverage based on their health status, lifestyle, or other risk factors. When it comes to the reinstatement of a policy, if the policy has lapsed or been terminated, the insurer may require the policyholder to provide evidence of insurability before the policy can be reinstated. This requirement helps the insurer reassess the risk associated with the individual, as there may have been changes in their health or circumstances since the original coverage was issued.

The requirement for evidence of insurability serves to protect the insurer from accepting a higher level of risk without fully understanding the current situation of the insured. This is important because the condition or risk level of the individual may have changed during the time their policy was inactive.

In contrast, acquiring a new policy, renewing an existing policy, or initiating a group policy typically involves different underwriting processes and may not necessitate the same level of evidence if the risk profile is already known or is covered under broad group policies. Thus, reinstatement specifically highlights the insurer's need to evaluate risk before agreeing to continue coverage.