Group Term Life Insurance

  • OkBima
  • 16 Jan 2023

What is Group Term Life Insurance?

The power of numbers is undeniable. We are stronger when we work together, and it is now possible to safeguard our loved ones while also assuring the safety of all members of our group. Whether it’s an employer-employee group or a non-employee group, group term plans provide financial help and achieve financial independence for all members of the group’s families.

If you are a working employee, you can take advantage of your employer’s group term insurance plan to ensure that your loved ones’ future is safe and secure, as they will receive a death benefit if something happens to you.

Employer-provided group term life insurance plans have become an important component of employee benefit packages. Most fraternal organizations, in fact, provide group term life insurance to their members.

For people with financial responsibilities, life insurance is a must-have product.

Who are eligible for Group Term Life Insurance Policy?

It is offered to the following: –

Professional groups

Non-employer employee groups

Non- banking financial institutes

Microfinance institutes


What are the various types of Group Term Life Insurance Policy?

The various types of Group Term Life Insurance Policy are: –

Uniform cover to all the members

Ranked cover for various grades of member

Cover for outstanding housing loans, car loans etc.

With added riders like critical illness benefits, accidental benefits etc.

How does Group Term Life Insurance Policy work?

It is given to all members of a specific organisation if they meet certain fundamental insurability requirements.

Medical reports are not required.

The maturity level isn’t specified.

Death is covered by the plan.

Benefits to the Employers

Employers profit from group term life insurance coverage just as much as employees do.

Group term life insurance products make it simple for employers to cover their gratuity liability. Gratuity funds are carefully constructed to cover future gratuity payments, alleviating the load on the employer.

Returns on the funds will be received based on the performance of the client-selected funds.

In India, group term life insurance policies are more affordable because managing schemes on a group basis is less expensive.

Funds that perform better will earn higher returns, which will reduce the employer’s costs.

Some programmers provide both life insurance and gratuity benefits for employers.

Benefits to the Employees

Employees are guaranteed financial support for their families in the event of their death, serious sickness, or other unforeseen circumstances.

Employees can enjoy the ease of not having to undergo medical examinations until their free coverage runs out.

The premiums that their employers pay are not considered perquisites.

Employees can take advantage of Section 10 death benefits, which are tax-free (10D)

Simple documentation allows for easy administration.

Can be tailored to fit the specific demands of the enrolled staff

Provides protection to the insured’s family and protects the insured’s financial interests.

What are the features of Group Term Life Insurance Policy?

The benefits of group term life insurance plans are numerous, making them ideal for employee benefit packages. The following are just a handful of the many benefits of group life insurance:

Members can join at any time during the year.

In the event of the insured’s death, a predetermined sum assured is paid to the beneficiary.

Add-on covers, often known as riders, provide coverage for severe illnesses, accidental fatalities, disability, and other events.

The application process is simple and quick.

The group must have a minimum of 50 members.

As a built-in benefit, terminal sickness is covered.

Cheaper as compared with Individual policy coverage

Employees can enjoy their perks while having a good and solid relationship with their employers.

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