State RegulationsCA specific✓ Verified · outline & fact-checked · Sep 2026Difficulty 2/5
Under California Insurance Code Section 10270.5, which entity qualifies as a group for group disability insurance?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Section 10270.5 requires that a qualifying group, such as an employer group, union, or trade association, be formed for purposes other than obtaining insurance. The group must be a bona fide entity whose members share a common bond unrelated to buying coverage, which prevents adverse selection by people who band together only to purchase insurance. This group-formation requirement is the foundation of group health underwriting in California and is examined under the qualified-group provisions of AH-III.B.1a.
Why the other options are wrong
- B) A group formed solely to buy insurance is not a bona fide qualifying group and would undermine risk pooling.
- C) The group must exist as a genuine entity before the policy is issued, not be assembled afterward.
- D) A single family lacks the employer or association relationship required for group eligibility under Section 10270.5.
Memory hook
Bona fide first, insurance second: a real group, then coverage.