§3803. Employee groups

Link to law: http://legislature.vermont.gov/statutes/section/08/103/03803
Published: 2015

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The Vermont Statutes Online



Title

08

:
Banking and Insurance






Chapter

103

:
LIFE INSURANCE POLICIES AND ANNUITY CONTRACTS






Subchapter

005
:
GROUP LIFE INSURANCE










 

§

3803. Employee groups

The lives of a

group of individuals may be insured under a policy issued to an employer, or to

the trustees of a fund established by an employer, which employer or trustees

shall be deemed the policyholder, to insure employees of the employer for the

benefit of persons other than the employer, subject to the following

requirements:

(1) The

employees eligible for insurance under the policy shall be all of the employees

of the employer, or all of any class or classes thereof determined by

conditions pertaining to their employment. The policy may provide that the term

"employees" shall include the employees of one or more subsidiary

corporations, and the employees, individual proprietors, and partners of one or

more affiliated corporations, proprietors, or partnerships if the business of

the employer and of such affiliated corporations, proprietors, or partnerships

is under common control through stock ownership, contract, or otherwise. The

policy may provide that the term "employees" shall include the

individual proprietor or partners if the employer is an individual proprietor

or a partnership. The policy may provide that the term "employees"

shall include retired employees. No director of a corporate employer shall be

eligible for insurance under the policy unless such person is otherwise

eligible as a bona fide employee of the corporation, by performing services

other than the usual duties of a director. No individual proprietor or partner

shall be eligible for insurance under the policy unless he or she is actively

engaged in and devotes a substantial part of his or her time to the conduct of

the business of the proprietor or partnership. A policy issued to insure the

employees of a public body may provide that the term "employees"

shall include elected or appointed officials.

(2) The premium

for the policy shall be paid by the policyholder, either wholly from the

employer's funds or funds contributed by him or her, or partly from such funds

and partly from funds contributed by the insured employees. No policy may be

issued on which the entire premium is to be derived from funds contributed by

the insured employees. A policy on which no part of the premium is to be

derived from funds contributed by the insured employees must insure all

eligible employees, or all except any as to whom evidence of individual

insurability is not satisfactory to the insurer.

(3) The policy

must cover at least two employees at date of issue.

(4) The amounts

of insurance under the policy must be based upon some plan precluding

individual selection either by the employees or by the employer or trustees.

(Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 2, subch. 6, § 3); amended 2005,

No. 36, § 7, eff. June 1, 2005; 2009, No. 137 (Adj. Sess.), § 5.)
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