Who is typically issued the master policy in a group insurance plan?

In a group insurance plan, the master policy is typically issued to employers. This arrangement is designed to facilitate the coverage of a group of individuals—usually employees and their dependents—under a single policy.

Employers act as the policyholders in this context, meaning they are responsible for administering the plan and ensuring compliance with various regulatory requirements. They also handle the collection of premiums and can make certain decisions about the policy, such as selecting the coverage types and benefit levels for their employees. This structure simplifies managing insurance for multiple individuals, as it centralizes the policy under one entity rather than issuing individual policies to each employee.

Employees, on the other hand, receive certificates of insurance that outline their coverage under the master policy, but they do not hold the master policy themselves. Insurance brokers typically facilitate the relationship between the employers and the insurers, ensuring that the coverage meets the needs of the group but do not hold the policy. Lastly, policyholders usually refer to the individuals who own the insurance policy, which in the case of group insurance means the employer. This distinction clarifies the role of employers in holding the master policy, laying the groundwork for offering group insurance as a valuable employee benefit.