A method of marketing group benefits to employers who have a small number of employees is the
MET
Blanket Life Insurance
ART
Small Employer Trust
MET
(A method of marketing group benefits to employers who have a small number of employees is the multiple employer trust (MET). METs may provide a single type of insurance (such as health insurance) or a wide range of coverage (life, medical expense, an
Under a group life policy, the insurer will issue an individual _____ to the policyowner for delivery to each person insured.
policy
certificate
application
rider
certificate
What are blanket life policies?
Policies that are mass-marketed
Policies that cover everyone in a household
Policies that are issued by the Guaranty Association covering multiple insurers
Policies that cover a group of people exposed to a common hazard
Policies that cover a group of people exposed to a common hazard
(Blanket life insurance covers a group of people exposed to a common hazard. Individuals do not need to apply for blanket coverage and insurers do not need to provide each person with a cert
Which of the following makes a group life policy different from an individual life policy?
Higher premium
Higher underwriting costs
Individual underwriting
Lower premiums
Lower premiums
(The primary reason for a group life plan having lower premiums is the lower administrative, operational, and selling expenses associated with servicing one contract, as opposed to several individual contracts.)
When an employer pays the entire premium of a group plan, the plan is called
Rebating
Waiver of premium
Contributory
Noncontributory
Noncontributory
(In a noncontributory plan, an employer pays the entire premium and the employee is not expected to contribute.)
The insured is which one of these in group life insurance?
Applicant
Policyowner
Beneficiary
Certificate holder
Certificate holder
(Each employee eligible to participate in the plan fills out an enrollment card and is given a certificate of insurance, which summarizes the coverage terms and explains the employee's rights under the group contract.)
In group life policies, individual certificates are given to
Each policyholder
Each insured
Each applicant
The insurance agent
Each insured
(Each employee eligible to participate in a group plan fills out an enrollment card and is given a certificate of coverage. This certificate summarizes the coverage terms and explains the employee's rights under the group contract.)
The coverage, conditions, and limitations in the master policy of a group contract can be found in which document?
Certificate of Authority
Consumer report
Coverage document
Certificate of coverage and benefits
Certificate of coverage and benefits
Group insurance plans that require employees to pay a portion of the premium are called
underwritten
contributory
participatory
shared
contributory
Which of the following statements regarding group life insurance plans is CORRECT
The employee is generally responsible for paying the entire premium.
Group insurance, per unit of benefits, is available at rates lower than those for individuals.
An employ
Group insurance, per unit of benefits, is available at rates lower than those for individuals.
(Group insurance generally is available at rates lower than those for an individual because of the lower administrative, operational, and selling expenses assoc
In an employer group plan, what is the name of the policy issued to the employer?
Certificate of insurance
Certificate of authority
Group contract
Master contract
Master contract
All of the following are distinguishing characteristics of group life insurance EXCEPT
Flow of insureds
Group underwriting
Master contract
Individual policies
Individual policies
All of the following statements about group life insurance for employees are true EXCEPT
The policy is issued to the employer
Evidence of insurability is normally required of each participant
Premiums may be paid jointly by the employer and the employees
Evidence of insurability is normally required of each participant
Insurers require that a minimum number of trade association member employees participate in a group insurance plan in order to
maximize premium income
minimize adverse selection
calculate valid loss ratios
lower plan expenses
minimize adverse selection
(The larger the group to be insured, the more predictable will be the expected losses from the group.)
Tim is covered under a group plan and would like to change his group coverage to an individual policy with the same insurer because of employment termination. Which of these describes the change that will take place?
Coordination of benefits
Conversion
Ex
Conversion
Abbey's employer recently made group insurance available for its employees as a benefit. After filling out her enrollment card, she is given a(an)
policy
receipt
certificate of insurance
application
certificate of insurance
(This summarizes the coverage terms and explains the employee's rights under the group contract. In these cases, the employer is the applicant and contract policyholder.)
A non-contributory health insurance plan helps the insurer avoid
adverse selection
state compliance
the underwriting process
tax deductions
adverse selection
(Because all eligible employees are usually covered, noncontributory plans are desirable from an underwriting standpoint because adverse selection is minimized.)
Converting a group plan to permanent life insurance involves
submitting proof of insurability
paying a lower premium
converting to term life insurance
the conversion being applied within 1 month of termination
the conversion being applied within 1 month of termination
All of the following conditions are included in group credit life programs EXCEPT
Premiums are usually paid by the borrower
The amount of insurance per borrower is limited
Benefits are paid to the borrower's beneficiary
Benefits are paid to the creditor
Benefits are paid to the borrower's beneficiary (Benefits in a credit life policy are normally paid to the creditor.)
State insurance laws generally allow a number of groups to hold blanket life insurance policies. All of the following are examples of groups eligible for blanket life insurance EXCEPT
A school covering students, teachers, or employees.
Members of a sports
A start up company to cover the health insurance needs of its employees
(Blanket life insurance policies cover eligible groups for blanket LIFE insurance , not health insurance.)
To what is a group life plan in which the employer pays the entire cost commonly referred?
Contributory plan
Noncontributory plan
Group permanent plan
Group paid-up plan
Noncontributory plan
Which of the following statements about the certificate of insurance is true?
It is a binding contract between the employee and the insurer
It serves as evidence of an employee's coverage
It is issued to the employer
It is used only when accidental death
It serves as evidence of an employee's coverage
The conversion privilege under a group life plan allows an employee to convert to a(n)
family plan with another insurer
individual plan with another insurer that has better rates
individual plan upon employment termination
individual policy in the spouse'
individual plan upon employment termination
The type of insurance most frequently used in group life plans is
annually renewable term.
10-year renewable term.
limited pay whole life.
single-premium whole life.
annually renewable term.
(Annual renewable term insurance gives the insurer the right to increase the premium each year (based on the group's rating) and gives the policyholder the right to renew coverage each year.)
All of these are requirements of a group life plan EXCEPT
A minimum number of participants are required
The cost of the plan is dictated by average age of group
Participants receive a certificate of coverage
Participants are required to provide evidence o
Participants are required to provide evidence of insurability
A group life insurance plan must insure all eligible employees if the
Group was formed for the express purpose of obtaining insurance
Employer pays the entire premium
Employees are covered under a retirement plan
Employer pays for a group health insurance
Employer pays the entire premium
What does the Group Life underwriting risk selection process help protect insurance companies from?
Risk aversion
Natural selection
Adverse selection
Risk management
Adverse selection
If an employee wants to enter the group outside the open enrollment period, the insurer may
Require evidence of insurability
Require a higher premium
Require an extended open enrollment period
Require physical exams on existing members
Require evidence of insurability
(If an employee does not enroll in the plan during the enrollment period (typically 31 days), the employee may be required to provide evidence of insurability if enrollment is desired at a later date. This is to protect th
All of the following employees would normally be excluded from a group term life plan EXCEPT
A full-time employee who has been on the job 2 years
Employee who works part time each week
Employee who works less than 3 months a year
Employee with less than 3
A full-time employee who has been on the job 2 years
Most employers will establish benefit schedules according to all of the following EXCEPT
Earnings
Age
Employment Positions
Flat Benefit
Age
(Most employers will establish benefit schedules based on an employee's earnings or position within the company. A flat benefit to each employee may also be an option. An employee's age is not taken into account.)
A type of group that has a constitution and bylaws and has been organized for purposes other than obtaining insurance is called a(n)
employer group
employee group
association or labor group
multiple coalition
association or labor group
(They are organized and maintained in good faith for purposes other than obtaining insurance.)
Jackie has just signed up to participate in her employer's franchise life insurance program. Which of the following statements is CORRECT?
She may not continue the policy if she terminates employment.
As the "sponsor" of the program, her employer collects
As the "sponsor" of the program, her employer collects premiums from her and remits them to the insurance company.
(Franchise life insurance is a form of group insurance covering employees of a common employer or are members of a common association. The e
An employee under a group insurance policy has the right to name a beneficiary and the right to
remain on the group plan in the event of employment termination
cash surrender the existing policy
change the policy provisions
convert to an individual policy
convert to an individual policy in the event of employment termination
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.
An insured employ
An insured employee must convert to the same type of coverage that was provided under the group plan (that is, term).
(Most group conversion provisions require the individual to convert the coverage under a group term plan to a whole life policy.)
If an employee in poor health is part of a large group that is acceptable for group life insurance, that employee is
ineligible for coverage under the plan
eligible for coverage, but on a rated basis
eligible for the same type of coverage as other employe
eligible for the same type of coverage as other employees
Which of these factors would an insurer consider when determining whether to accept a group life plan?
Number of dependents
Incontestable period
Average age
Grace period
Average age
If group life insurance premiums are paid totally by the employer, the minimum percent of eligible employees required to be covered is
25%
50%
75%
100%
100%
What action may the insurer take on future policy anniversaries after a group life master policy has been issued?
Cancel insurance on group members who become terminally ill
Insurer can make no changes to policy
Insurer can deny claims after a group has e
Insurer can adjust premium
(Most group life plans are term plans, which use annual renewable term (ART) insurance for the underlying policy. This gives the insurer the right to increase the premium each year (based on the group's experience rating), and i
Which of the following is NOT considered to be a group permanent plan?
Group ordinary
Group credit
Group universal
Group paid-up
Group credit