Final answer:
The conversion period following termination of a group life insurance policy, where one can convert to an individual policy, typically is around 31 days. For precise terms, individuals should check their policy documents or contact their insurance provider. Premium calculations consider risk factors, which affects the actuarially fair premium rate.
Step-by-step explanation:
When a group life insurance policy is terminated, generally an individual is given a specific period of time, known as the conversion period, in which they can convert their group coverage to an individual policy without having to provide evidence of insurability.
The conversion period can vary depending on the policy provisions, but it is often around 31 days. However, to obtain the precise duration of the conversion period for a specific policy, one should review their policy documents or consult with the insurance provider directly.
As for the question regarding the selling of life insurance to groups with different risks, and calculating the actuarially fair premium, various factors including mortality rates and the size of the payout upon death are taken into account.
An insurance company that does not differentiate its premiums based on risk factors such as family cancer history might have to increase premiums or face losses if the actual claims exceed their priced premiums.