Final answer:
The correct answer is D, as the conversion to permanent life insurance must be applied for within 31 days of termination of the group plan. It's essential to meet this requirement to ensure the benefits of conversion. Other options are either incorrect or not typically necessary for this process.
Explanation:
Converting Group Life Insurance to Permanent Life Insurance
When a policyholder wishes to convert group life insurance to permanent life insurance, there are specific requirements to be met. Among the options provided:
- A. Converting to term life insurance - This is not applicable since the goal is to convert to permanent life insurance.
- B. Submitting proof of insurability - Not always necessary; many group plans allow for conversion without additional proof.
- C. Paying a lower premium - This is incorrect, as premiums for permanent life insurance tend to be higher than those for term or group plans.
- D. The conversion must be applied for within 31 days of termination - This is correct. Most plans stipulate that the conversion must be done within 31 days after the group coverage ends to qualify for the benefits of conversion.
In summary, the correct answer is D. To properly switch from group coverage to a permanent policy, the application for conversion should occur within the specified timeframe.
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