Massachusetts Health & Accident Insurance Practice Exam

Which of the following can be a requirement for group health coverage?

1. A minimum age requirement

2. Employment status verification

3. A certain number of insureds participating

4. Previous medical history documentation

The correct answer is: A certain number of insureds participating

A certain number of insureds participating is a fundamental requirement for group health coverage. Insurers typically set minimum participation levels to ensure that the group is large enough to spread risk effectively. This requirement mitigates the risk of adverse selection, where only those most likely to need insurance (such as individuals with pre-existing conditions) join the plan. By requiring a certain number of insureds, insurers can maintain a balanced risk pool, which allows for more stable premiums and better financial stability for the group coverage. While aspects like minimum age requirements, employment status verification, and previous medical history documentation might come into play in different insurance contexts or specific insurance policies, they are not universal prerequisites for group health coverage. The emphasis on the number of participants is crucial to the structure and viability of group health plans, thus establishing the collective principle that underpins them.