Chapter 6 Life Flashcards
A noncontributory group term life plan is characterized by
The entire cost of the plan is paid for by the employer. When an employer provides noncontributory group term life insurance, the employer pays the entire cost of the plan.
An employee of 20 years recently retired at age 59 1/2. This employee’s group life contract can be
Converted to an individual permanent policy at an individual rate
Under federal tax laws, what is the tax treatment for an employer providing $50,000 of a contributory group Term Life plan to all its eligible employees?
Portion of the premiums paid for by the employer may be a tax deduction. In a contributory plan, the employer may file a tax deduction for its share of the premium costs.
The percentage of eligible employees participating in a non-contributory plan MUST be
100%
Employees covered by an employer-sponsored group Term Life Insurance plan receive
Certificates of insurance
Which of the following is an important underwriting principle of group life insurance?
Physical examinations are required
Everyone must be covered in the group
Employer must pay for the entire premium
The group must be formed for the purpose of getting affordable insurance
Everyone must be covered in the group
When an employee is terminated, which statement about a group term life conversion is true?
Employee must convert group term life coverage into an individual term life policy
Employee must provide evidence of insurability for conversion
Policy proceeds will be paid if the employee dies during the conversion period
olicy proceeds will NOT be paid if the employee dies during the conversion period
Policy proceeds will be paid if the employee dies during the conversion period. An individual must apply for individual coverage within 31 days after the date of group coverage termination. An individual is covered under the group policy during the conversion period.
Under federal tax laws, what is the tax treatment for an employer providing $50,000 of a contributory group Term Life plan to all its eligible employees?
Portion of the premiums paid for by the employer may be a tax deduction