Questions and Answers
If its employees share in the cost of insurance, what type of group life insurance plan would a corporation have?
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
What type of group insurance plan involves employees sharing the cost?
If a corporation pays the premium on a group life policy for its employees, how much additional taxable income must be reported for each employee?
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A noncontributory group term life plan is characterized by:
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Which requirement must be met for an association to be eligible for a group life plan?
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An employee of 20 years recently retired at age 59 1/2. This employee's group life contract can be:
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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?
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Under a trustee group life policy, who would be eligible for a certificate of coverage?
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What group term life feature permits an individual to depart from the group and continue to be covered without providing evidence of insurability?
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Study Notes
Group Life Insurance Terminology
- A contributory plan requires employees to share the cost of group life insurance premiums.
- If an employee with $25,000 group term life coverage is terminated, they can convert this coverage to a $25,000 individual whole life policy.
Group Insurance Characteristics
- In a noncontributory group term life plan, the employer is responsible for the entire cost of the policy.
- For a group to be eligible for a group life insurance plan, it must be formed for reasons other than acquiring insurance.
Coverage and Policies
- An employee retiring after 20 years of service can convert their group life contract to an individual permanent policy at the applicable rate.
- Employers providing $50,000 of a contributory group term life plan may deduct the portion of premiums they cover from their taxes.
Eligibility and Continuation
- Under a trustee group life policy, it is the employee who is eligible to receive a certificate of coverage.
- The conversion feature of group term life insurance allows individuals to maintain coverage after leaving the group without needing to provide evidence of insurability.
Tax Implications
- Corporations paying premiums for group life policies do not report any additional taxable income for employees under a noncontributory plan.
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Description
Test your knowledge on group life insurance terms and concepts. This quiz covers contributory and noncontributory plans, conversion options, and eligibility requirements for group life insurance. Learn the details that distinguish different policies and their advantages.
