Group life insurance is one of the fastest-growing coverage alternatives for employers. If you aren’t familiar with this type of coverage, let’s catch up. Understanding how a group life policy works will help you make the right financial decisions for your employees.
What is a Group Life Insurance Plan?
Group life policies refer to a life insurance plan where a business owner is a policyholder, and a set number of employees are covered. The owner can choose to pay all the premiums themselves or deduct a proportion of the premium from the salary of the covered employees.
What are the Features of a Group Life Policy?
Group Life policies offer the following features:
- Group Coverage Group insurance policies cover many insured under a single policy purchased by the company. The business owner is the policyholder who chooses the insurance plan and completes the formalities on behalf of the employees who will receive insurance benefits.
- Flexible Addition or Removal Under a master contract plan, the policyholder—the employer—has complete control over the insured. They can remove or add anyone into the insurance plan at any given period. Usually, these insurance plans offer a fixed number of insured individuals; however, policyholders are free to add or remove individuals if they do not cross that number.
- Affordable One of group insurance policy’s most important features is its affordability. In most cases, a company will offer a special discount to policyholders if a certain number of insured individuals are met. Suppose a company chooses to ultimately pay the premium or deduct a certain proportion of the premium from an employee’s salary. In that case, either outcome will allow employees to enjoy life insurance coverage at very low or no cost.
- Multiple Options There are several group life policies available in the market. One common type is a group term plan, which provides insurance for an insured group for a set number of years. Another common type is a group whole life policy, which provides life insurance coverage for a group of employees. The company can choose any plan, according to its needs and expectations.
- Employee Benefits
Group insurance is an excellent way to provide financial security to employees in an era where everything is going digital. It is best suited for companies in which hundreds of employees can be insured at once, unlike an individual policy that offers coverage per person. Group insurance also helps keep the staff motivated, as they know that their employer takes good care of them financially. This ensures that the employees feel secure. Also, since the cost associated with group life policies is meagre, employers can easily manage this cost and enjoy increased productivity and retention rates. Get the best group insurance plans with Plum Insurance today.
Why Should you Consider a Group Life Policy?
A group life plan is one of the most common employee benefits policies. This is because the policy protects their dependents, friends and family from financial disaster when an employee dies unexpectedly. The employer also receives certain benefits from this policy.
- Improved Productivity Rates
With the growing requirements of businesses, companies are looking for ways to ensure maximum employee productivity. Most companies are providing group life coverage to their employees, as it helps in increasing employee productivity and makes them feel secure and confident.
- Improved Retention Rates
A group life plan is a financial life-support system that protects family members and their spouses in case the breadwinner dies. When your employee is registered under you or a company and has worked for a considerable period, they can expect this financial stability from you. By providing group life coverage, you can retain old employees depending on you for their economic well-being.
- Assured Retirement for Employees
A comfortable retirement is a must for anyone who has quit their job. However, most employees don’t have enough financial stability after they retire. Group life policies offer them this stability once they finish their working tenure with a company.
- Tax Benefits
A group life policy allows the business to receive tax breaks. This is so because the premium for a group life insurance policy is not considered an income for the firm but rather a business expenditure.
Why Choose Group Life Plans?
Group life policy is one of the critical investment tools of any company. In the event of your untimely death or disability, life insurance may provide your family or other loved ones with financial stability. It makes sense for your business to invest in a group health insurance plan for employees, especially if multiple people, such as your managers and executives, are eligible for it.
Team members should think carefully about term life insurance as an essential part of their employee benefits package, since it may save them a sizable sum of premium on their insurance policy, particularly if they continue to work in the future. This can help your team members stay financially secure by making sure that they have adequate life insurance coverage for their loved ones who might depend on them for financial support.
You can also extend the benefits to group accident insurance plans and group health insurance policies to provide comprehensive coverage to your employees. All premiums paid by you for any of the group plans could be treated as an expense. Alternatively, you could choose to share the premium with your employees as well.
Conclusion
Group life insurance is an excellent way to provide financial security to employees in an era where everything is going digital. It is best suited for companies in which hundreds of employees can be insured at once, unlike an individual policy that offers coverage per person. Group insurance also helps keep the staff motivated, as they know that their employer takes good care of them financially. This ensures that the employees feel secure. Also, since the cost associated with group life policies is meagre, employers can easily manage this cost and enjoy increased productivity and retention rates. Get the best insurance plans with Plum Insurance today.
