Lesson 7: Group Life Insurance

A company has 1,200 eligible employees for its group life insurance program, and the company pays the total premium. How many employees must be insured to start the plan? 600 900 1000 1200

1200 - If a group life insurance plan is noncontributory, 100% of eligible persons must be insured.

If a company has 2,000 employees eligible for a noncontributory group life insurance program, how many would be required to participate? 500 1000 1500 2000

2000 - If a group life insurance plan is noncontributory, 100% of eligible persons must be insured.

In underwriting group insurance, companies use all of the following underwriting guides to guard against adverse selection EXCEPT: medical examinations. minimum participation rules. benefits determined by formula. careful group selection.

medical examinations - Medical examinations are not used in underwriting group insurance to guard against adverse selection.

Dave started work at ABC Plumbing on May 15. ABC offers a noncontributory group life insurance plan to its employees after a probationary period. If the probationary period is the typical number of days, Dave will be eligible for group life insurance on: May 30. August 15. June 15. July 15.

August 15 - The typical probationary period for a group life insurance plan is 90 days.

All of the following are characteristics of group life insurance EXCEPT: Group insurance is usually written without evidence of insurability. With group insurance, minimum participation standards are required. With group insurance, each insured receives a policy. The group is underwritten as a whole, rather than individually.

With group insurance, each insured receives a policy - A group life insurance plan issues a master policy or contract that sets forth the terms and conditions between the insurance company and the employer or sponsoring association. The employees or members do not receive individual policies; they each receive a certificate of insurance.

A local pipefitters and brick masons union work together to create a trust to provide insurance to their employees. This type of trust is called: a Taft-Hartley trust. a Multiple Employer trust. an Employee Group trust. a Labor Union Group trust.

a Taft-Hartley trust - A Taft-Hartley trust is formed by employers in related industries in order to provide health insurance to their employees.

A certificate of insurance in a group life insurance plan: is issued to each employee covered under the group life insurance plan. is not considered proof of coverage for the employee and their family. is issued to the employer to show which employees are covered under the group plan. contains all policy information except the specific coverage benefits.

is issued to each employee covered under the group life insurance plan - Group life insurance plans issue a master certificate or master policy to the business owner and issues certificates of insurance to covered employees. The certificate of coverage shows the coverage benefits and is proof of coverage.

A Certificate of Insurance issued to an insured under a group insurance plan is required to contain all of the following information except: name of beneficiary. amount of insurance protection. agent name. effective date.

agent name - The NAIC model Bill for Group Life Insurance does not require the name of the agent to be in a Certificate of Insurance.

Group insurance plans where the premium is paid by both the employer and employee is called: multiple employer trust. noncontributory plan. contributory plan. multiple employer welfare arrangement.

contributory plan - In a contributory plan, the premium is paid by both the employer and employee. At least 75% of all eligible employees or members must be covered.

All of the following statements pertaining to the conversion privilege of group term life insurance are correct EXCEPT: an insured employee typically has 31 days following termination of employment in which to convert the group insurance. when a group plan is terminated, group coverage of the insureds generally is extended for 60 days. insureds who convert their coverage to individual policies pay a premium rate according to their attained age. a covered individual may exercise the conversion privilege regardless of his or her insurability.

when a group plan is terminated, group coverage of the insureds generally is extended for 60 days - When a group plan is terminated, group coverage of the insureds generally is extended for 31 days.

All of the following statements are false except: a policy must have both a probationary and an eligibility period. the probationary period runs before the eligibility period. the eligibility period runs before the probationary period. a policy cannot have both a probationary and an eligibility period.

the probationary period runs before the eligibility period - If there is an eligibility period, it will run after the probationary period.

When underwriting group life insurance: the underwriter generally focuses on the group as a whole, rather than on specific individuals. the underwriter generally requires extensive medical information from all of the group members. the underwriter generally requires extensive medical underwriting on each individual. the underwriter generally focuses on individual members of the group, rather than the group as whole.

the underwriter generally focuses on the group as a whole, rather than on specific individuals - Group insurance underwriting focuses on the group as a whole rather than specific individuals of the group.