State RegulationsPA specificDifficulty 2/5
An employee's group life coverage under an employer's plan ends when he leaves the job. Under 40 P.S. § 532.7, what conversion right does he have in Pennsylvania?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
40 P.S. § 532.7 provides the conversion privilege for Pennsylvania group life: when a member's group coverage terminates, the member may convert to an individual policy without evidence of insurability. The protection exists precisely because the departing member may no longer be insurable on the open market — his health has nothing to do with the conversion right. The individual policy stands on its own; the group master contract stays with the policyholder.
Why the other options are wrong
- B) The master policy belongs to the group policyholder; conversion issues the member his own individual policy, it does not hand over the group contract.
- C) Requiring a medical examination would hollow out the conversion right, which Pennsylvania law grants without evidence of insurability.
- D) Group premiums paid during employment bought the group protection; termination does not entitle the member to their refund.
Memory hook
Leave the group, keep the right: convert with no medical questions asked.