Which of the following statements is CORRECT about group life insurance policies?

A is correct under current Hawaiʻi law. HRS §431:10D-212 permits qualifying group life insurance policies to extend coverage to the spouses and dependent children of insured employees or members. Hawaiʻi amended this provision so that a spouse or dependent may be covered in an amount equivalent to the amount of coverage of the insured individual . Act 155 of 2008 removed the former statutory limitation that had restricted certain dependent coverage to 50% of the insured individual's coverage or $5,000.

This point is particularly important because older insurance-study materials may still reproduce the former 50% limitation. That older rule is not the controlling Hawaiʻi provision for the current examination.

Option B is therefore incorrect for two reasons: it says coverage must be provided and incorporates the obsolete 50% ceiling. The statute states that dependent coverage may be extended and permits an amount equivalent to the insured individual's coverage.

Options C and D are also incorrect. Hawaiʻi group-life provisions recognize conversion rights under applicable circumstances; they do not establish a blanket prohibition on conversion privileges for spouses or dependent children.

Reference topics: HRS §431:10D-212; Act 155, SLH 2008; Group Life Insurance; Spouse and Dependent Coverage; Conversion Rights.

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