Final answer:
Underwriting considerations for group coverage typically include the principle that groups do not need individual medical exams. Premiums are set based on the collective risk of the group, maintaining actuarial fairness to cover costs and profits without overcharging high-risk individuals.
Step-by-step explanation:
Underwriting considerations for group coverage do not typically involve rating the group based on the oldest insured, nor do they simply charge larger groups higher premiums without consideration of other factors. Instead, one of the underwriting considerations for group coverage is that groups usually do not have a requirement for medical exams. Insurers often use the principle of risk pooling, where the risk of the entire group is considered rather than individual factors such as age or gender; this approach simplifies administration and can make coverage accessible to more people.
Actuarial fairness is also a consideration, aiming to set premiums that reflect the expected claims, company costs, and profit margins. However, when actuarially fair premiums are applied to individuals, high-risk groups may end up paying more. For instance, groups with high healthcare costs or dangerous occupations might face higher premiums. Yet, charging a uniform premium to all may lead to issues of adverse selection, where those with lower risks opt-out, leaving a riskier and more expensive pool of insured.
Therefore, the correct option in this context is 'd. Groups usually do not have a requirement for medical exams'. This reflects the overall approach where group underwriting often focuses on the collective risk and aims to avoid individually burdensome requirements.