An employee covered by his employer's group life plan is terminating employment. Which statement describes the continuation concept that applies to his life coverage?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Group life coverage depends on membership in the group, so termination of employment ends eligibility — but the law preserves the member's bridge to individual protection through a conversion right. On losing group status, the member may apply to convert to an individual policy without evidence of insurability, which prevents a departing member from becoming uninsurable simply because the job ended. This protection is a core feature of the group life framework (N.J.S.A. 17B:27-68 through 17B:27-75) administered in New Jersey under the oversight of the Department of Banking and Insurance.
Why the other options are wrong
- B) Group coverage tracks membership; it does not continue automatically just because the former member offers to keep paying.
- C) Requiring new medical evidence would defeat the purpose of the conversion protection for departing members.
- D) A certificate is personal evidence of one member's coverage; it cannot be reassigned to a different person.
Memory hook
Leave the job, keep the bridge: convert to individual coverage, no health questions asked.