West Virginia State Life Insurance Practice Exam

A labor union must have at least how many members to be issued a group life policy?

1. 15

2. 25

3. 35

4. 50

The correct answer is: 25

In West Virginia, the statutory requirement for a labor union to be eligible for a group life policy is that it must have a minimum of 25 members. This requirement is designed to ensure that the group is large enough to spread the risk among its members, making the coverage viable and financially sound for the insurance provider. A labor union serves as a collective bargaining organization that provides various benefits, including life insurance coverage, to its members. The minimum membership requirement helps to create a stable pool of insured individuals. With too few members, the risk associated with insuring lives becomes unmanageable for the insurer, potentially leading to higher premiums or the unavailability of coverage altogether. In this context, having at least 25 members establishes a sufficient basis for a group life policy, making option B the correct choice.