Certified Financial Consultant (CFC) Practice Exam

What is NOT a requirement for associations to buy group insurance for its members?

1. Has at least 50 members

2. Members must be of a certain age

3. Must have a defined purpose

4. Members should be residents of the same state

The correct answer is: Members must be of a certain age

In the context of requirements for associations to purchase group insurance for their members, certain criteria dictate eligibility and structure. One critical aspect is the composition of the membership, which generally does not mandate that members must be of a specific age. This allows a wider range of individuals to participate in the group insurance policy, as age restrictions can limit accessibility and affordability. On the other hand, the other requirements—such as having a minimum number of members, the association having a defined purpose, and all members being residents of the same state—are typically necessary to qualify for group insurance. These stipulations help insurance providers assess risk and manage the insurance pool effectively. Thus, recognizing that age is not a defining criterion helps clarify the focus on inclusive and diverse membership in group insurance plans. This understanding is vital for associations looking to provide benefits to their members.