Under CIC Section 10202.5, which of the following is an eligible group that may be insured under a group life insurance policy?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Group life insurance is available only to certain qualifying groups, and employees of a single employer are the classic eligible group. Section 10202.5 restricts group eligibility to groups with a legitimate common bond, such as employer-employee relationships, union memberships, or associations, so that group coverage is not used as a disguised form of individual insurance. A group created merely to buy insurance does not qualify because it lacks the bona fide purpose that group rules require. Statutes also require that the group not be created solely for the purpose of obtaining insurance, preserving the legitimate common bond.
Why the other options are wrong
- B) The general public is not a defined group with a common bond and cannot be insured under a group life policy. Employees of a single employer share the common bond that group eligibility rules require.
- C) A group formed solely to obtain insurance lacks the bona fide common purpose that eligibility rules require. The general public has no common bond and cannot be treated as an eligible group for coverage.
- D) A single individual buying a policy for a family member is an individual purchase, not a group arrangement. A group organized solely to buy insurance is not bona fide and fails the eligibility test.
Memory hook
Eligible groups need a real common bond: same employer, same union, same association. Insurance-shopping clubs do not count.