Which of the following statements about group accident and health insurance is TRUE?

Group accident and health insurance is a type of coverage that is primarily designed for groups of individuals, such as employees of a company, members of an association, or other organized groups. One of the key characteristics of this type of insurance is that it is subject to both state and federal regulations, ensuring that the policies meet certain standards for coverage and consumer protection.

Regulation is important because it helps protect members of the group from potential abuses or gaps in coverage. For instance, the Affordable Care Act (ACA) has specific requirements regarding essential health benefits that must be included in group health plans. Additionally, state regulations can dictate aspects such as premium rates, claims practices, and minimum benefit levels, making compliance with these regulations essential for group accident and health insurance providers.

In contrast to other options, focusing solely on employer-sponsored groups limits the understanding of the broader applicability of group plans that can encompass other organized collectives. Furthermore, individual policies are distinctly separate from group plans, as group accident and health insurance is intended for a collective approach rather than individual underwriting. Lastly, while group plans can provide substantial benefits, they do not universally guarantee higher coverage limits than individual policies; coverage details will vary based on the specific plan terms rather than being inherently linked to the group format