Employers have no obligation under North Carolina law to offer life insurance to their employees. However, if group life insurance is among the benefits offered to workers, certain minimum requirements must be satisfied (NC Gen. Stat. Sec. 58-58-135 and Sec. 58-58-140).
Group characteristics. The group to be insured must include all employees or all employees belonging to a class of employees determined by conditions pertaining to their employment. The group may include employees of a subsidiary corporation or affiliated corporation under certain circumstances, as well as retired employees.
Beneficiary. The employee can name anyone except the employer as beneficiary.
Employer/employee contributions. Employers are not required to make a contribution toward the cost of group insurance. However, if the employer does pay the entire premium, all eligible employees must be insured. If employees pay all or part of the cost, the structure of the group must be actuarially sound.
Portability of group life insurance. An insurer may not use health questions, underwriting, or eligibility requirements that pertain to health status when an individual insured elects to access a portability option provided by a group life insurance policy. "Portability" means the prerogative to continue existing group life insurance coverage, or access alternate group life insurance coverage, that may be provided by a group life insurance policy to an individual insured after the individual's affiliation with the initial group terminates. This requirement applies to all group life insurance policies in North Carolina.
Conversion. Employees are guaranteed the right to convert group coverage to an individual policy in the ...