Chapter 8 "Group Life" Insurance Questions
What is the minimum participation rate of eligible employees for non-contributory plans? Select one: a. 100% b. 75% c. 50% d. 67%
(A) 100%
How long must an individual have been insured under the group life insurance plan in order to be eligible for the conversion privilege? Select one: a. 6 months b. 12 months c. 5 years d. 10 years
(C) 5 years
Which of the following is life insurance that covers federal employees? Select one: a. Group life b. Group health c. SGLI d. FEGLI
(D) FEGLI
Which of the following is the method for rating group insurance premiums based on the prior claim history of the group? Select one: a. Experience rating b. Community rating c. Group rating d. Claims rating
(A) Experience Rating
All of the following are standard provisions under a group life insurance policy, EXCEPT: Select one: a. Grace period of 61 days b. 2-year contestability period c. Entire contract consists of the policy and application d. Conversion right
(A) Grace period of 61 days
What type of group insurance plan allows the policyowner to pay the minimum amount of premium for anticipated claims and the insurer pays the excess? Select one: a. Minimum premium b. Retrospective premium c. Shared-funding d. Administrative Services Only (ASO)
(A) Minimum Premium
Group insurance plans for non-employer groups in which the insured pays all the premiums are called: Select one: a. Contributory plans b. Non-contributory plans c. Fully contributory plans d. Payee plans
(C) Fully contributory plans In group employer policies, employers must pay at least some portion of the premium. Non-employer groups in which the members are fully responsible for paying premiums and the group pays no part of the premiums are called fully contributory plans.
What type of group health insurance plan is self-funded, but an insurer processes the claims? Select one: a. Minimum premium b. Retrospective premium c. Shared-funding d. Administrative Services Only (ASO)
(D) Administrative Services Only (ASO)
In employer-sponsored group insurance, the employer is the _______________, and the employee is the _______________. Select one: a. Policyowner; insured b. Policyowner; beneficiary c. Insured; policyowner d. Insured; beneficiary
(A) Policyowner; insured
Unlike group life insurance, insureds under franchise plans each receive: Select one: a. Their own policy b. A master contract only c. A certificate of insurance only d. A master contract and certificate of insurance
(A) Their own policy
What is the term for the period when an individual is eligible for coverage under a contributory plan and may enroll in the group plan? Select one: a. Probationary period b. Eligibility period c. Elimination period d. Open enrollment period
(B) Eligibility period
Serena dies 15 days after her group life insurance coverage is terminated. She did not apply for individual coverage. Which of the following is true? Select one: a. Serena's beneficiary will receive 50% of the death benefit. b. Serena's beneficiary will receive the full death benefit. c. Serena's beneficiary will receive the death benefit minus the initial premium for the converted coverage. d. Serena's beneficiary will not receive the death benefit because Serena's group coverage was terminated.
(B) Serena's beneficiary will receive the full death benefit
All of the following are true regarding group term life insurance, EXCEPT: Select one: a. Group life insurance is most often issued as guaranteed annual renewable term. b. The policy is issued for one year and may be renewed annually with evidence of insurability. c. Premiums may be raised at renewal d. Group term insurance may cover the insured's dependents, such as a spouse and children.
(B) The policy is issued for one year and may be renewed annually with evidence of insurability
All of the following statements are true of group life insurance contracts, EXCEPT: Select one: a. Insureds do not own the policy. b. The group must exist naturally. c. Enrollees must provide proof of insurability. d. Premiums are based on the claims experience of the group as a whole.
(C) Enrollees must provide proof of insurability
All of the following are true regarding group life insurance contracts, EXCEPT: Select one: a. They have a grace period. b. Members have the right to convert their policy. c. Evidence of insurability is never required for enrollment. d. The application may be attached to the policy.
(C) Evidence of insurability is never required for enrollment
Which of the following is not true about adverse selection in group insurance? Select one: a. The possibility of adverse selection is lower in group insurance. b. Seasonal employees are less likely to be insured than permanent employees. c. Younger people pose a great risk because of their lifestyles. d. Benefits must be pre-established.
(C) Younger people pose a great risk because of their lifestyles
Which of the following classifications of employees is not used for the purpose of determining group insurance eligibility? Select one: a. Full-time or part-time/seasonal b. Salaried or hourly c. Union or non-union d. Age or gender
(D) Age or gender Insureds under a group policy are typically classified according to their employment status. By classifying employees, the employer decides which class/classes of employees are eligible for coverage. While employees can be classified by their job responsibilities, union or non-union status or department, employees may not be classified based on their sex or age.
What is the term used to describe a group's ability to pay premiums and renew group coverage? Select one: a. Persistency b. Continuity c. Consistency d. Payability LH82001 Feedback
(A) Persistency
What is the standard number of days allotted to an employee to convert their group life policy to an individual life policy? Select one: a. 15 b. 31 c. 46 d. 60
(B) 31
Group insurance plans in which the policyowner pays all of the premiums are called: Select one: a. Contributory plans b. Non-contributory plans c. Fully contributory plans d. Payor plans
(B) Non-contributory plans
