State RegulationsCA specific✓ Verified · outline & fact-checked · Sep 2026Difficulty 2/5
Under California law, which of the following would generally NOT qualify as an eligible group for group health insurance?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
California's group insurance rules (CIC Sections 10270.5, 10270.505, 10270.55, and 10270.57) require that a group exist for a bona fide purpose other than obtaining insurance. A group formed mainly to buy coverage does not qualify because it would attract adverse selection without a true common bond. Legitimate groups include employer-employee groups, union groups, and associations formed for other purposes.
Why the other options are wrong
- B) Employer-employee groups are the classic permissible group and are expressly allowed under California law.
- C) Union groups covering members are recognized as eligible groups under California's group insurance rules.
- D) An association formed for purposes other than insurance, such as a trade association, is an eligible group provided it meets the statutory conditions.
Memory hook
A group must exist for a real purpose, not just to grab insurance. Purpose-then-policy, not policy-then-purpose.