Life Insurance - Chapter 6: Group Life Insurance
A noncontributory group term life plan is characterized by?
the entire cost of the plan is paid for by the employer
An employee with $25,000 group term life coverage was recently fired. This employee's group coverage may be converted to a
$25,000 individual whole life policy
A non-contributory plan requires _____ participation of all eligible employees
100%
What is an important underwriting principle of a group life insurance?
Everyone must be covered in the group
Under federal tax laws, what is the tax treatment for an employer providing $50,000 of a contributory group Term Life plan to all its eligible employees?
Portion of the premiums paid for by the employer may be a tax deduction
Group life insurance policies are generally written as
annually renewable term
All individuals covered under a group contract will receive a
certificate
What provisions are required in a group life policy?
conversion, grace period, incontestable period
An employee of 20 years recently retired at age 59 1/2. This employee's group life contract can be
converted to an individual permanent policy at an individual rate
TRUE statements about noncontributory employee group life insurance
covers all eligible employees, no evidence of insurability is required, must have conversion rights
contributory
group insurance issued by employer under which both the employer and employees contribute to the cost of the plan
This is NOT true of noncontributory employee group life insurance
A minimum number of employees is required to participate
noncontributary
employee benefit plan under which employer bears the full cost of the employees benefits
What group term life feature permits an individual to depart from the group and continue to be covered without providing evidence of insurability?
Conversion
Which requirement must be met for an association to be eligible for a group life plan?
Group was formed for a purpose other than acquiring insurance
What type of group insurance plan involves employees sharing the cost?
Contributory plan