Group life insurance policies are generally written as which type of accounting policy?

• A. Participating policies
• B. Variable life policies
• C. Non-participating policies
• D. Universal life policies

Answer: (C)

Verified step by step guidance

1. Understand the concept of group life insurance policies: These are insurance policies that cover a group of people, typically employees of a company, under a single contract.
2. Learn about the different types of life insurance policies: Participating policies, variable life policies, non-participating policies, and universal life policies. Each has distinct features and accounting treatments.
3. Focus on non-participating policies: These policies do not pay dividends to policyholders and are typically structured with fixed premiums and benefits. They are commonly used for group life insurance because they simplify administration and cost management.
4. Compare non-participating policies with other types: Participating policies involve dividend payments, variable life policies depend on investment performance, and universal life policies offer flexible premiums and benefits. These features are less suitable for group life insurance purposes.
5. Conclude that group life insurance policies are generally written as non-participating policies due to their straightforward structure and cost-effectiveness for covering large groups.