Life Insurance Policies
Why is group life insurance generally cheaper per unit than individual insurance?
Answer and explanation
Answer: B. One master contract, one sales effort and group rather than individual underwriting spread the expense over many lives. The cover is not limited to accidents, insurers are not tax exempt, and members undergo less individual scrutiny rather than more.Source: PSI — New York DFS Insurance Candidate Information Bulletin — Outline, group cost
More life insurance policies questions
- What happens to a survivorship life policy when the first of the two insured lives ends?
- What happens to the cost of an increasing term benefit as the insured ages and the coverage amount rises?
- What happens under a whole life policy if the insured lives to the contract's maturity age?
- What is distinctive about the cash value of a single premium whole life policy in its first year?
- What is experience rating in a group life plan?
- What is limited about a limited payment whole life policy?
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