(a) Health insurance on a franchise plan is that form of health insurance issued to
(1) five or more employees of a corporation, copartnership, or individual employer or a governmental corporation, agency, or department of them; or
(2) 10 or more members, employees, or employees of members of a trade or professional association or of a labor union or of any other association having had an active existence for at least two years if the association or union has a constitution or bylaws and is formed in good faith for purposes other than that of obtaining insurance.
(b) If these persons, with or without their dependents, are issued the same form of an individual policy varying only in amounts and kinds of coverage applied for by the persons under an arrangement whereby the premiums on the policies may be paid to the insurer periodically by the employer, with or without payroll deductions, or by the association for its members, or by some designated person acting on behalf of the employer, association, or union, the term “employees” as used herein may be considered to include the officers, managers, and employees and retired employees of the employer and the individual proprietor or partners if the employer is an individual proprietor or partnership.
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