Life Insurance Policies
Why do group underwriting requirements set a minimum number of members?
Answer and explanation
Answer: D. Predictability depends on numbers, so a minimum group size keeps actual mortality close to expected. Small employers reach that size by joining a multiple employer trust rather than being barred from cover.Source: PSI — New York DFS Insurance Candidate Information Bulletin — Outline, group minimum size
More life insurance policies questions
- A surgeon aged forty expects high earnings for twenty years and then a much lower income. Which whole life form fits?
- A term insured becomes uninsurable but wants permanent cash-value coverage during the policy’s conversion period. Which feature can meet that objective?
- A term policyowner exercises a renewal provision after the original term ends. What premium change should the owner generally expect?
- A twenty year level premium term policy reaches its twentieth anniversary and the insured wants to keep the cover. What usually happens to the premium?
- A universal life owner wants to vary the timing and amount of premium payments. Which condition remains essential?
- A universal life policy’s cash value is no longer sufficient to cover current insurance costs, and the owner makes no additional payment. What is the principal policy risk?
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