Although all eligible individuals are able to get coverage under group insurance benefits regardless of age or physical condition, there are some minimal requirements that they must meet.

The two major criteria are that they must work a certain number of hours per week and have worked for a specified length of time before they can apply for coverage under the group plan.

What is the probationary period and what does it mean to a new employee? The probationary period is the length of time an employee must work for the employer before being able to submit their application for the group insurance benefits. The average length of the probationary period is 90 days, but can be more or less depending on the details of the plan.

How is the eligibility period different from the probationary period? The eligibility period is how many days after the end of the probationary period that the employee has to submit their application for coverage. This is usually 31 days.

What happens if you miss signing up for coverage during the eligibility period? Three things may happen depending on how stringent the insurance company issuing the coverage is.

The broker working with the insurer could backdate the employee’s application if it is not too long after the end of the eligibility period.

The employee may be subject to some individual underwriting.

The employee will have to wait for the plan’s next renewal, which triggers an open enrollment period.

If you are an employer, it is important that you make sure your new employees understand these eligibility guidelines.

If you are a new employee, make sure you know these time lines and do not miss the opportunity to sign up for your group insurance benefits.

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Group Insurance Benefits Companies

Group insurance benefits are sponsored (or in simpler terms, purchased) by employers, trade associations, labor unions, multiple employer groups, credit-debtor groups and lodges. When one of these entities enters into an agreement with an insurer, they are issued a master policy and the individuals participating are issued a certificate of insurance (COI) and an outline describing the benefits. To better illustrate this, with an individual policy, the agreement is between the individual and the insurer. With a group policy, the relationship is between the sponsoring organization and the insurer.

Types of group insurance benefits include medical, dental, vision, life, long & short-term disability and long term care coverage.

Depending on the agreement between the sponsoring organization and the insurer, these benefits can be extended to just the employee or may include coverage for their dependents.

Frequently, the benefits provided under group contracts are obtained at a far better rate than the employee could obtain on their own. Also, the benefits provided under these contracts are more extensive and have higher benefit maximums than do individual policies.

Since there is normally no medical information asked of the individual participants, some people might be able to get coverage under the group umbrella when they would be denied coverage because of pre-existing conditions or other factors if they applied for an individual policy.

However, group policies normally contain a provision excluding pre-existing conditions and state when a condition will no longer be regarded as pre-existing. Usually, the time line on a pre-existing condition is six months. This includes the three months prior to the effective date of the coverage and the three months after the effective date of the coverage. In order to be labeled as pre-existing, the participant must have had treatment for the condition during that first three-month period.

The area of group insurance benefits is a large one and there is much to discuss. In this blog we will discuss the details, guidelines, pros and cons, and future outlook of group insurance benefits.

To see what insurance questions are being discussed by insurance agents and brokers visit The Insurance Forums.

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