Connecticut Life Producer Practice exam

What happens to a death claim if a person insured under a group policy dies during the conversion period to an individual policy?

1. The claim is payable under the individual policy.

2. The claim is payable under the group policy.

3. The claim is not payable at all.

4. The claim can be contested under both policies.

The correct answer is: The claim is payable under the group policy.

When an insured individual dies during the conversion period from a group policy to an individual policy, the claim is typically payable under the group policy. This is because, during the conversion period, the group insurance remains in effect until the individual policy is fully processed and issued. Often, group policies contain provisions that protect members during this transition, ensuring that if death occurs before the conversion is complete, the benefits are still provided through the group policy. The logic behind this provision is to ensure that individuals do not lose coverage during the potentially confusing time of transitioning from group insurance to individual coverage. The individual policy comes into effect only after the conversion is finalized, which would not be the case at the time of death. Thus, the group policy remains the source for any claims arising during that period.