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These contracts are not required to be adhered to on a definitive basis, as many small company insurance contracts are. The business who is offering the coverage can decline an employer if the history of their claims is determined to be too risky. No individual can be excluded from receiving coverage if they can show that they are eligible for the benefits.
United States law requires that such contracts must be renewed annually, but only in cases where the employer accepts this. The only time a contract will not be renewed is if the company has not paid their premiums for the workers. In such cases, the courts may consider the employer as guilty of fraud. Such contracts will also be considered void if any of the terms and conditions has not been adhered to.
It is also required by law that a health coverage company must give a worker full credit for any preexisting condition that she or he may have. The coverage for each worker will be calculated by an underwriter at the time that it is purchased by the providing company. Rates can vary between groups, but they are generally based on worker participation and any outstanding claims that have not been settled.
The business who provides the insurance must gather all of the pertinent data from each participant in the group. The worker may have to fill out a questionnaire on their general health so that the insurer can calculate the amount of risk. The risk is lower with more participants.