Question

What is one of the basic requirements for designing a group insurance scheme to prevent anti-selection?

a.

The group should be formed explicitly for the purpose of obtaining insurance.

b.

The determination of benefits per member should be solely at the discretion of the employer.

c.

Employees should be actively at work on the date they become eligible for insurance.

d.

Insurance must be incidental to the existence of the group.

Posted under IC 92 Actuarial Aspects of Product Development

Answer: (d).Insurance must be incidental to the existence of the group. Explanation:One of the basic requirements for designing a group insurance scheme to prevent anti-selection is that insurance must be incidental to the existence of the group. This means that the group should not be formed explicitly for the purpose of obtaining insurance, but rather insurance should naturally complement the group's primary purpose or relationship, such as employer-employee relationships. By ensuring that insurance is not the primary motivation for forming the group, the scheme can avoid adverse selection and maintain the integrity of the insurance pool.

Interact with the Community - Share Your Thoughts

Uncertain About the Answer? Seek Clarification Here.

Understand the Explanation? Include it Here.

Q. What is one of the basic requirements for designing a group insurance scheme to prevent anti-selection?
Add Comment

Similar Questions

Explore Relevant Multiple Choice Questions (MCQs)

Q. What is the purpose of having an automatic basis to determine the level of coverage per employee in a group insurance scheme?

View solution

Q. Who is typically eligible for insurance cover in a group insurance scheme?

View solution

Q. What additional eligibility condition may apply for employees to qualify for insurance coverage?

View solution

Q. What is the purpose of a waiting period in a group insurance scheme?

View solution

Q. When does coverage typically cease in a group insurance scheme?

View solution

Q. How is disability handled in group insurance schemes in some developed countries?

View solution

Q. Which approach provides extended death benefit coverage for employees who become totally disabled prior to retirement age?

View solution

Q. What is typically required for continued waiver of premium in group insurance schemes?

View solution

Q. How does a new group term plan come into existence?

View solution

Q. Which of the following is NOT typically included in the general description of a group insurance product?

View solution

Q. Which of the following is a requirement specified in the Form IRDA-Life-Non Linked-NP for insurers to file a group term product to IRDA of India?

View solution

Q. What aspect of group insurance product design helps avoid anti-selection by individuals within a group?

View solution

Q. What information is typically required to be provided under the heading "Reinsurance" when filing a group term product with IRDA of India?

View solution

Q. Which of the following parameters is typically included in the financial projections section when filing a group term product with IRDA of India?

View solution

Q. Which of the following statements regarding the submission of policy terms and conditions to IRDA of India is accurate?

View solution

Q. What types of occupations are typically included in Class 1 of the occupation classification?

View solution

Q. Which occupation class may include skilled craftsmen and tradesmen whose duties involve only light manual work?

View solution

Q. Which occupation class may include auto and auto-related manufacturing, assembly, service and repair workers, along with farmers and long and short haul truck drivers?

View solution

Q. How is the pure risk premium calculated for a group?

View solution

Q. What does the gross premium include?

View solution
View All MCQs on IC 92 Actuarial Aspects of Product Development

Recommended Subjects

Are you eager to expand your knowledge beyond IC 92 Actuarial Aspects of Product Development? We've handpicked a range of related categories that you might find intriguing.

Click on the categories below to discover a wealth of MCQs and enrich your understanding of various subjects. Happy exploring!

Mass Transfer

Delve into the science of Mass Transfer with our specialized category. Explore...

IC 89 Management Accounting

Boost your preparation for the IC 89 Management Accounting exam with our extensive...

Virology

Explore the captivating world of Virology with our specialized category. Dive into...

Non Verbal Reasoning

Enhance your cognitive abilities with our Non-Verbal Reasoning category. Dive into...

Enzyme Technology

Unlock the power of enzymes with our Enzyme Technology category. Explore enzyme...

Drug and Pharmaceutical Biotechnology

Navigate the world of pharmaceuticals and biotechnology with our dedicated category....

Highway Engineering

Navigate the road to efficient transportation with our Highway Engineering category....

Environmental Biotechnology

Discover the intersection of biology and environmental science with our Environmental...

Electronics and Communication Engineering

Explore the dynamic field of Electronics and Communication Engineering with our...