Life: Chapter 6

How long is the conversion period?

-31 days

Group life insurance can be obtained by what groups?

-Single-employee groups -multiple-employee groups -labor unions -trade associations -credit/debit groups -fraternal organizations -trustee gruops

What are the requirements of an employee in order to be able to participate in group insurance?

-must be full-time and actively working -Set up for automatic payroll deduction if contributory -Past 1-6 month probationary period -Enrolled within 31 days of enrollment period, or they need to provide proof of insurance

What is Franchise life insurance?

A form of group life insurance in which participants are employees of common employer/members of a common association or society.

What is a non-contributory plan?

A plan in which the employee pays the entire cost of the plan; 100% participation

A non-contributory health insurance plan helps the insurer avoid what?

Adverse selection

What is a contributory plan?

An employee group insurance plan in which employees share the cost; requires 75% participation

The conversion privilege under a group life plan allows an employee to convert to what?

An individual plan upon employment termination.

A type of group that has a constitution and bylaws and has been organized for purposes other than obtaining insurance is called a what?

Association or labor group

When are premiums for group life insurance tax-deductible?

If employer pays the premium, it can deduct them as a business expense.

What is Group Credit Life Insurance?

Insurance set up by banks, finance companies, etc. so if insured dies before a loan is repaid the benefits will be used to settle the balance.

Converting a group plan to permanent life insurance involves what?

The conversion being applied within 1 month of termination.

Define "certificate of insurance".

What employees obtain as evidence of their coverage as they do not own the policy. They are certificate holders.

Under a group life policy, the insurer will issue an individual ______ to the policyowner for delivery to each person insured.

Certificate

The coverage, conditions, and limitation in the master policy of a group contract can be found in which document?

Certificate of coverage and benefits.