The Group

The minimum number of employees which may be insured without medical examination varies from fifty to two hundred and fifty, and these must be carefully inspected and passed upon as a group before they will be accepted by the company. Such matters as sex, average age, and general health of employees, sanitary construction, upkeep of the plant, and other aspects of the environment of the workers are considered in determining whether the group is of a sufficiently high standard.

This inspection performs the same function for the group as does a medical examination for the individual and emphasizes the essential difference between group insurance and insurance of individuals. In the former case the group is the unit of the risk and only those matters which affect it as a group should be considered in determining its desirability, in the latter the individual is the unit. It is essential that the underwriter, in approving a group, exercise the same careful judgment that is displayed by the medical examiner in approving an individual.

If these general conditions are satisfactory each employee fills out a census slip stating his name, age, residence, duties, date of entering employment, and the amount of insurance desired. The premium necessary to pay for the insurance on each life is then computed; and a premium for the group secured, which is quoted to the employer. If the quoted rate is satisfactory and the employer decides to take out the insurance, each employee signs a personal application giving the same information as was contained in the census slip. The employer files a general application, giving a list of his employees and certifying that the statements in their individual applications are true, to the best of his knowledge and belief.

New employees may be added to the group under the same terms, except that some companies require a medical examination. Some companies also stipulate a certain period of employment before the new name may be added.3 When a member of the group withdraws from the employ of the firm his insurance automatically ceases. Several companies give him the privilege, however, of taking out other insurance in the company for an amount not greater than that for which he was insured under the group plan, at regular premium rates, but without the requirement of a medical examination. In all cases of additions or withdrawals the employer must immediately notify the insurance company.