In group life insurance, which statement correctly describes the master policy and the certificate?

Why A is correct

In group life insurance, the insurer issues a master policy to the group policyholder, typically the employer or association, and that master policy is the actual contract between the insurer and the group policyholder. Each covered employee receives a certificate of coverage that summarizes the benefits, conditions, and the employee's rights under the master policy. The certificate is evidence of coverage, not a separate contract, and its terms are governed by the master policy. The group structure allows many individuals to be covered under one contract.

Why the other options are wrong

• The relationship is reversed: the master policy goes to the employer or group sponsor, and the certificates go to the insured employees. Accordingly, this option is not correct because it does not match the specific rule or product that is described in the question.
• A master policy is one contract covering the whole group; individual employees are not issued separate master policies by the insurer. This option therefore does not match the facts presented in the question and is not the correct answer to select.
• The master policy is the contract between the insurer and the group policyholder; the certificate is a summary issued to the employee. This answer describes a different situation from the one in the question and is therefore incorrect under the facts given here.

Memory hook

The employer gets the master policy, and each employee gets a certificate.