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Employee benefits are generally covered under the federal jurisdiction of the Employee Retirement Income Security Act (ERISA).
Federal ERISA plans generally do not have to comply with state laws. ERISA rules preempt or block state laws that relate to ERISA plans. State insurance laws, however, do apply. North Carolina law covers group life insurance, which provides, for example, the following:
The employer cannot be the beneficiary.
The premium must be paid either wholly from the employer's funds or funds contributed by him or from funds contributed by the insured employees, or from funds contributed jointly by the employer and employees.
A policy on which all or part of the premium is to be derived from funds contributed by the insured employees may be placed in force provided the group is structured on an actuarially sound basis.
A policy on which no part of the premium is to be derived from funds contributed by the insured employees must insure all eligible employees.
The policy must cover at least 10 employees at date of issue.
Grace period of 31 days.
“Group life insurance” defined
NC General Statute - Chapter 58, Article 58 (§58-58-135)
Group life insurance standard provisions
NC General Statute – Chapter 58, Article 58 (§58-58-140)