Page 24 - Life Assurance

the group policy owner for the benefit of the
individual members. In most plans, the group
policy owner is the employer. Employees receive
a certificate of insurance that shows they are
insured.

2- A second characteristic is that group
insurance usually costs less than comparable
insurance purchased individually. Employers
usually pay part or all of cost, which reduces or
eliminates premium payments by the employees.
In addition, administrative and marketing
expenses are reduced as a result of mass
distribution methods.

3- Another characteristic is that individual
evidence of insurability is usually not required.
Group selection of risks is used, not individual
selection. The insurer is concerned with the
insurability of the group as a whole rather than
with the insurability of any single member within
the group.

4- Finally, experience rating is used in group
insurance plans. If the group is sufficiently large,
the actual loss experience of the group is a
major factor in determining the premiums
charged.

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