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- 1. Multiple Choice1. The parties to a master group insurance contract are the(1) insurer, the group policyholder, and the group insureds(2) insurer and the group policyholder only(3) insurer and the group insureds only(4) group policyholder and the group insureds only
- 2. Multiple Choice2. The following statements are about group insurance contracts. Select the answer choice containing the correct statement.(1) If a group policyholder pays the entire premium amount for the group coverage, then the group insurance plan is a contributory plan.(2) Each group member must receive individual copies of the master group contract.(3) Group policyholders are not required to provide each group member with a certificate of insurance or a separate benefit booklet that describes the group insurance plan.(4) Each group member insured under a group life insurance policy has the right to name the beneficiary who will receive the benefit payable upon that group member’s death.
- 3. Multiple Choice3. Martin Buchanan accepted a job with the Madrigal Company on June 5, 2016, and actually began working for Madrigal on June 10, 2016. Madrigal provides both noncontributory group life insurance and contributory group health insurance to its employees. Madrigal’s employee benefits plan requires a typical 30-day probationary period and a 31-day eligibility period. This information indicates that Mr. Buchanan’s group life insurance coverage will become effective on(1) June 10, and he will be eligible to enroll for group health insurance coverage during a 31-day period that begins on June 10(2) June 10, and he will be eligible to enroll for group health insurance coverage during a 31-day period that begins on July 10(3) July 10, and he will be eligible to enroll for group health insurance coverage during a 31-day period that begins on July 10(4) July 10, and he will be eligible to enroll for group health insurance coverage during a 31-day period that begins on August 10
- 4. Multiple Choice4. The following groups have applied for group life insurance coverage from Palindrome Financial. Palindrome’s group underwriting guidelines are typical of most insurers. Select the answer choice describing a group that will likely FAIL to qualify for group insurance coverage.(1) In the United States, the Cardamom Labor Union promotes the welfare, interests, and rights of its members.(2) Golden Years Associates is a small group of retired individuals who have formed a group for the sole purpose of obtaining group life insurance coverage at reasonable rates.(3) The Didactic Company is a professional organization for accountants that provides continuing education classes and organized travel opportunities and seeks to provide voluntary group insurance coverage to its members.(4) The Colossal Association is a group consisting of the eligible employees of several small employers and two labor unions that are in the building industry.
- 5. Multiple Choice5. Group underwriters consider a number of specific characteristics of a group when evaluating whether that group is an acceptable risk. One factor that would tend to make an employer-employee group eligible for group insurance coverage is if the(1) group has a sufficient number of new members periodically entering the group so that both the group’s size and its age distribution remain relatively stable(2) group will maintain at least a 25% participation level at all times in the group insurance plan(3) group insureds are permitted to select their own coverage amounts(4) employer plans to pay no portion of the group insurance premium
- 6. Multiple Choice6. Group life insurance policies typically include a schedule that defines the amount of life insurance the policy provides for each insured. For example, the schedule might provide life insurance coverage to all eligible employees in an amount equal to one year’s salary. In another schedule, the amount of life insurance coverage might vary depending on whether the employee is a senior executive, a manager, or a nonmanagement employee. By definition, this schedule is known as(1) a blended rating schedule(2) an experience refund schedule(3) a benefit schedule(4) a self-administered group plan schedule
- 7. Multiple Choice7. Primrose Financial Services is negotiating with the following two prospective clients for group life insurance coverage: The Azalea Company is a newly formed organization that employs nine people; The Hydrangea Company is seeking life insurance coverage for its 1,500 employees. Hydrangea is presently insured by another insurer. With regard to the methods used to calculate the premium rate for group insurance coverage and these two companies, it most likely is correct to say that Primrose Financial will use(1) manual rating for both Azalea and Hydrangea(2) manual rating for Azalea and experience rating for Hydrangea(3) experience rating for both Azalea and Hydrangea(4) experience rating for Azalea and manual rating for Hydrangea
- 8. Multiple Choice8. The Sequoia Corporation provides $50,000 of noncontributory group life insurance coverage for each of its eligible employees. The current monthly premium rate for this coverage is $0.60 per $1,000 of coverage. In February, Sequoia had 100 eligible employees. On March 1, Sequoia hired five additional employees who immediately became eligible for group life insurance coverage. During the month of March, the number of Sequoia employees remained constant. This information indicates that the amount of the premium payable for the month of March was3015030003150
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