FSC reminds consumers that the objective of insurance is to cover future possible losses by the policy holder paying an agreed premium. Preexisting conditions have already occurred before insurance is purchased so, naturally, the insurance mechanism cannot be used to make up losses. If a policy holder fails to inform the insurer of an illness when he/she buys a policy, the insurance firm is not liable to pay insurance benefit under Article 127 of the Insurance Act; also, if the insurer finds out the policy holder was not honest about preexisting conditions within two years of he/she taking out an insurance policy, the insurer can terminate the insurance contract under Article 64 of the Insurance Act. To avoid disputes, when applying for an insurance policy, people should reply to the insurer’s written questions about preexisting conditions or current illness in detail.