Group Life Insurance- this type of insurance constitutes almost half of all life insurance in force in the United States as of the end of 2005.[Life Insurers Fact Book 2006 The American Council of Life Insurers, Chapter 7 Life Insurance page 63.]Because of its frequent availability amongst employers, simplified underwriting requirements and affordability, group coverage is often the primary source for individuals' life insurance arrangements.

  • Eligibility: insurable groups include individual employers, multiple-employer groups, labor unions, fraternal associations, trade associations and creditor/debtor groups. While NAIC guidelines do not require a minimum group size as a condition for eligibility, most states require a minimum number of eligible participants for an employer to be able to offer a group plan. Full time and active employment typically constitutes eligibility. Additionally, some employers may require the satisfaction of a probationary period of new employees for a period of up to six months before they may enroll in the plan. The enrollment period of typically thirty one days follows, allowing the newly eligible employee to sign up for group coverage. Evidence of insurability may be required if the employee declines enrollment during the initial enrollment period and subsequently decides to join the plan. Once a policy is issued, insurers usually require a certain rate of participation in order for the group to keep coverage in force.


Group Life Insurance: Common features

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