HEB1- Environment Of EE plans

Question 1

Advantages of group technique

Answer 1

1. Designed to prevent adverse selection
2. Only certain groups eligible
3. Steady flow of lives through the group
4. Minimum requirement of persons in a group
5. Minimum participation
6. Eligibility requirement
7. Maximum limits
8. Automatic determination of benefits
9. Efficient administration

Question 2

Overall Employee Benefit Concerns

Answer 2

1. Employer vs employees
2. What benefits should be provided?
3. Who should be covered?
4. Should employees have options?
5. How should the plan be financed?
6. How should the plan be administered?
7. How should the plan be communicated?

Question 3

Reason of the growth of employee Benefit Plans

Answer 3

1. Business Reasons
   
   1. 1 attract capable employees
   2. 2 to retain current employees
   3. 3 Corporate Efficiency, productivity and improved employee morale
   4. 4 Employee’s welfare and social objectives
2. Collective bargaining
3. Favorable tax legislation
4. Efficiency of the employee benefit approach
5. Limitation on the size of wage increase
6. Varying legislative action
7. Benefit integrated with government benefits