AD Banker Comprehensive Practice Exam

What is the minimum group size required for maternity benefits to be included on the same basis as nonmaternity benefits?

1. 20 members

2. 5 members

3. 30 members

4. 15 members

The correct answer is: 15 members

Maternity benefits are a specific type of coverage that often requires a minimum number of participants in a group insurance plan to be offered on the same terms as other types of benefits, such as nonmaternity benefits. This minimum group size is important because insurance plans need enough pooled risk to account for the costs associated with maternity, which can be significant. The correct minimum group size of 15 members allows for a sufficient risk pool to spread the costs associated with maternity benefits among the covered members. This standard reflects the understanding that, with this number of participants, the insurance carrier can reasonably factor in the average expected claims for pregnancy and childbirth, balancing these with the premiums collected. Larger group sizes generally reduce the risk and help insurers manage costs more effectively. While smaller groups may still be able to obtain coverage, they might face higher premiums or more restrictive terms, making the inclusion of maternity benefits on the same basis as nonmaternity benefits less feasible. Therefore, 15 members is the threshold that supports offering maternity coverage without imposing more stringent criteria.