True Group Plan
What Does True Group Plan Mean?
A true group plan is a voluntary, guaranteed-issue group insurance plan that offers long-term care benefits to full-time employees of a company. This means it accepts all employees, regardless of their physical condition. These plans are particularly appealing to employees due to the relaxed underwriting requirements and relatively low premiums. Additionally, employees who are in good health or married can benefit from discounted premiums.
Insuranceopedia Explains True Group Plan
True group plans can be converted into identical individual plans when an employee leaves the company. However, these plans are no longer commonly used due to concerns about adverse selection, where individuals in poor health, who are less desirable for insurance, are the ones most likely to participate. This could expose the insurance company to significant financial risk in the future. As a result, insurance companies now offer multi-life long-term care insurance instead.
