Group health insurance is a single policy that covers multiple people. It’s typically offered through an employer or another legitimate (natural) group. The insurer issues one master policy to the group sponsor, and each covered person receives a certificate confirming their coverage.
Group insurance is usually more affordable than individual coverage because eligibility is based on group membership rather than individual risk. Many plans also allow dependents to be covered.
One master policy covers all participants
Participants receive certificates of coverage, not individual policies
The employer or group sponsor acts as the policyholder
Dependents can often be included under the employee’s plan
Eligibility rules and probationary periods may apply
A natural group exists for a legitimate reason other than obtaining insurance, such as employment or professional affiliation. These groups can qualify for group coverage.
A fictitious group is formed solely to buy insurance. Because it doesn’t exist for a legitimate purpose beyond insurance, it isn’t eligible for group insurance plans.
To join a group health plan, a person must be a valid member of the group - typically a full-time employee. Employers often impose a probationary period before coverage begins. Some plans also require the employee to be actively at work on the effective date.
Eligible group sponsors include:
Employers may tailor coverage to specific employee groups. Plans may:
Most group health plans allow insured members to add eligible dependents, including:
Each insured person receives a certificate that summarizes benefits, coverage limits, and how to file claims. The certificate isn’t the insurance policy itself. Instead, it serves as proof of coverage under the group’s master contract.
Group insurance provides a single master policy to a qualified group, with individual members receiving certificates of coverage. The group must be legitimate, and eligibility rules may include probationary periods and full-time status. Dependents can often be included in the coverage**.**
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