Chapter 9 - Group Life Insurance

Question 1

Reducing the chance of adverse selection

Answer 1

Purchasing insurance must be incidental to the group

Majority of the group must participate

Enrollment is limited to the enrollment period

The nature of the group itself

Question 2

The group contract

Answer 2

Only one policy will be issued to the employer

The one policy is the master policy

The individuals within the group will be issued certificates as their proof of coverage

Question 3

Contributory vs. Non-contributory

Answer 3

Contributory Plans:
- employee pay a portion of the premium
- 75% participation is required

Non-contributory Plans:
- employee does not contribute to the cost of the program. It is fully funded by the employer
- 100% participation is required

Question 4

Life Conversion Privileges

Answer 4

Term must be converted to whole life

Conversion must be chosen within 31 days

Conversion rates will be based on attained age

No proof of insurability will be required