Loma 281 - Module 4 UPDATED ACTUAL
Questions and CORRECT Answers
Group insurance - CORRECT ANSWER - Life or health insurance coverage for a group of
people under one insurance contract
Master group insurance contract - CORRECT ANSWER - An insurance contract that
insures a number of people
Group insured - CORRECT ANSWER - Individual covered by a group policy but is not a
party to the group contract. The insured, rather than the policyholder, names the beneficiary
Group policyholder - CORRECT ANSWER - The person or organization that decides what
types of group insurance coverage to purchase for a specific group, negotiates the terms of the
group insurance contract, and purchases the group insurance coverage
Certificate of insurance - CORRECT ANSWER - A document that describes the coverage
that the group insurance contract provides and a group insured's rights under the contract
Noncontributory plan - CORRECT ANSWER - A group insurance plan where only the
group policyholder pays the entire premium for the coverage. 100% of members must participate
in this plan
Contributory plan - CORRECT ANSWER - A group insurance plan where insured group
members must pay part or all of the premium for their coverage. Typically, at least 75% of
members must participate in this plan
Self-administered plan - CORRECT ANSWER - A group insurance plan for which the
group policyholder is responsible for handling the administrative and recordkeeping aspects of
the plan
, Insurer-administered plan - CORRECT ANSWER - A group insurance plan for which the
insurer is responsible for handling the administrative and recordkeeping aspects of the plan
Probationary period - CORRECT ANSWER - The length of time—typically, from one to
six months—that a new group member of a noncontributory plan must wait before becoming
eligible to enroll in the group insurance plan
Eligibility period - CORRECT ANSWER - A specified period of time, usually 31 days,
during which a new group member may enroll for group insurance coverage in a contributory
group insurance plan without evidence of insurability
Actively-at-work provision - CORRECT ANSWER - A group insurance policy provision
which states that, in order to be eligible for coverage, an employee must be actively at work—
rather than ill or on leave—on the day the insurance coverage is to take effect
Conversion privilege - CORRECT ANSWER - Allows an eligible group insured to convert
their group life insurance coverage to an individual life policy without evidence of insurability
Benefit schedule - CORRECT ANSWER - A schedule that defines the amount of life
insurance the policy provides for each insured. The amount is based on either a flat amount,
salary, or job classification
Yearly renewable term insurance - CORRECT ANSWER - A group plan of term life
insurance that provides coverage for one year and is renewable by the policy owner at the end of
the year
Group paid-up plan - CORRECT ANSWER - Group plan of cash value life insurance that
combines paid-up whole life insurance with term life insurance to provide a predetermined
amount of coverage. Overtime, the amount of term insurance decreases and is replaced with
paid-up whole life. Paid-up coverage remains with the individual after leaving the group plan
Questions and CORRECT Answers
Group insurance - CORRECT ANSWER - Life or health insurance coverage for a group of
people under one insurance contract
Master group insurance contract - CORRECT ANSWER - An insurance contract that
insures a number of people
Group insured - CORRECT ANSWER - Individual covered by a group policy but is not a
party to the group contract. The insured, rather than the policyholder, names the beneficiary
Group policyholder - CORRECT ANSWER - The person or organization that decides what
types of group insurance coverage to purchase for a specific group, negotiates the terms of the
group insurance contract, and purchases the group insurance coverage
Certificate of insurance - CORRECT ANSWER - A document that describes the coverage
that the group insurance contract provides and a group insured's rights under the contract
Noncontributory plan - CORRECT ANSWER - A group insurance plan where only the
group policyholder pays the entire premium for the coverage. 100% of members must participate
in this plan
Contributory plan - CORRECT ANSWER - A group insurance plan where insured group
members must pay part or all of the premium for their coverage. Typically, at least 75% of
members must participate in this plan
Self-administered plan - CORRECT ANSWER - A group insurance plan for which the
group policyholder is responsible for handling the administrative and recordkeeping aspects of
the plan
, Insurer-administered plan - CORRECT ANSWER - A group insurance plan for which the
insurer is responsible for handling the administrative and recordkeeping aspects of the plan
Probationary period - CORRECT ANSWER - The length of time—typically, from one to
six months—that a new group member of a noncontributory plan must wait before becoming
eligible to enroll in the group insurance plan
Eligibility period - CORRECT ANSWER - A specified period of time, usually 31 days,
during which a new group member may enroll for group insurance coverage in a contributory
group insurance plan without evidence of insurability
Actively-at-work provision - CORRECT ANSWER - A group insurance policy provision
which states that, in order to be eligible for coverage, an employee must be actively at work—
rather than ill or on leave—on the day the insurance coverage is to take effect
Conversion privilege - CORRECT ANSWER - Allows an eligible group insured to convert
their group life insurance coverage to an individual life policy without evidence of insurability
Benefit schedule - CORRECT ANSWER - A schedule that defines the amount of life
insurance the policy provides for each insured. The amount is based on either a flat amount,
salary, or job classification
Yearly renewable term insurance - CORRECT ANSWER - A group plan of term life
insurance that provides coverage for one year and is renewable by the policy owner at the end of
the year
Group paid-up plan - CORRECT ANSWER - Group plan of cash value life insurance that
combines paid-up whole life insurance with term life insurance to provide a predetermined
amount of coverage. Overtime, the amount of term insurance decreases and is replaced with
paid-up whole life. Paid-up coverage remains with the individual after leaving the group plan
