Which statement best describes a group life policy?

• A. A separate policy for each employee
• B. A policy for a single individual's personal use
• C. A single contract covering a group of employees
• D. A policy used only for retirees

Answer: (C)

Group life insurance is set up under one master contract that covers a defined group, usually the employees of a single employer. The employer owns the policy and pays the premiums, while each employee has coverage provided under that single contract. This is different from issuing separate policies for each person, or a policy intended for personal use, or something limited to retirees. Because all members are insured under one master policy with predetermined eligibility and coverage levels, the description that best fits is a single contract covering a group of employees.