State RegulationsFL specificDifficulty 2/5
Several Florida employers want to pool together to insure their employees under one group life arrangement through a trust. What is this arrangement?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Under Chapter 627, Florida Statutes, group life insurance may be issued to the trustee of a fund established by one or more employers or unions to cover their employees - the multiple-employer trust arrangement. The trustee holds the master policy and the covered employees of each participating employer receive certificates. It is a recognized eligible-group category, not an association or creditor group.
Why the other options are wrong
- A) Multiple-employer arrangements through a trust are lawful and recognized.
- B) An association group covers members of an association formed for non-insurance purposes - not employers pooling employees through a trust.
- C) A creditor-debtor group insures borrowers' loan balances; owing premiums does not create one.
Memory hook
Employers pool through a trustee - that's a MET, and it's legal.