“Wholesale life insurance” defined

1. As used in this Code, “wholesale life insurance” is that plan of life insurance, other than salary savings life insurance or pension trust insurance and annuities, issued to: (a) Three or more employees of any corporation, copartnership or individual employer or any governmental corporation, agency or department thereof; or (b) Ten or more members, employees or employees of members of any trade or professional association, or of a labor union, or of any association of members in the same or related occupations, profession or industry having had an active existence for at least 2 years, where such association or union has a constitution or bylaws and is formed in good faith for purposes other than that of obtaining insurance, Ê where such persons, with or without their dependents are issued the same form of an individual policy on the plan, varying only as to amounts of coverage applied for by such persons and under an arrangement whereby the premiums on such policies may be paid to the insurer periodically by the employer, with or without payroll deductions, or by the insured or association or union for its members, or by some designated person acting on behalf of such employer, association or union. The term “employees” as used in this section shall be deemed to include the officers, managers, employees and retired employees of the employer and the individual proprietor or partners if the employer is an individual or partnership. 2. Each policy issued under this section shall provide that the coverage shall terminate when the insured individual no longer qualifies for such policy under this section; but the policy may provide that it may be continued in force or be replaced with another policy if the premium, benefits and other relevant factors of the continued or replacement policy are the same as those of a similar individual policy not issued under or pursuant to this section.