Health and Life Insurance

Answer: C - When employees select health benefits from a variety of coverage options, this is called a cafeteria plan. The option of a cafeteria plan allows employees to select from a variety of coverage options. Although more complex and expensive for the employer, the cafeteria plan is designed to provide employees and their families with needed coverage that they choose for their particular situations. Under Section 125 of the Internal Revenue Code, the cafeteria must offer one taxable benefit and one qualified benefit.

Theory