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