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Group Coverage
Group medical coverage refers to a single policy issued to a group (typically, a business with employees, though there are other kinds of groups that can get coverage) that covers all eligible employees and, sometimes, their dependents. Individual medical coverage, on the other hand, is a single policy issued to a single person or family.
The rules are quite different for group coverage versus individual coverage, in large part because the insurer's risk is calculated differently. With individual coverage, the insurer will base its premium rates (or deny coverage) based on the detailed medical history of the person or family. A medical exam is often required.
With groups such as small businesses, on the other hand, the insurer determines a premium price based on risk factors balanced over the entire group, using general information on members of the group, such as age or gender. Perhaps most importantly, insurers are required by law to offer coverage to small groups. In contrast, there is no such guarantee of coverage for individuals.
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