Advantages of Group Life Insurance

Advantages of Group Life Insurance

Life insurance is a financial tool that provides peace of mindcomfort to the loved ones you leave behind; however, it is essential to note that it may not be able to replace all that you have lost. Proper planning can help reduce financial stresshelp mitigate some of the immediate concerns. Moving from individual life insurance policies to group term life insurance policies is becoming increasingly prevalent, with many businesses including this choice in their benefit plans. Before you enrol for group insurance, however, you need to understand its benefits first.

What Exactly is Group Term Life Insurance?

As part of an employee benefits bundle, employers provide group term life coverage to their employees. At times, this can be in addition to group personal accident insurance. Many large corporations not only offer free group term insurance to all their employees but also the flexibility to customizeinclude add-ons to their policy for a small price. Each company’s plan determines the type of coverage supplied. People between the ages of 18 years and 60 years are often qualified for group life insurance coverage.

Benefits for Employers

Here is a list of benefits offered by group life insurance policies to employers:

1. Performance Boost

It is a known fact that group life insurance offers numerous benefits to both employersemployees. This is because the benefits associated with this policy are monetary as well as emotional, serving to reduce the varied forms of stress the concerned families experience.

It also helps employees to focus on their work, as they don’t have to worry if they would be able to provide a comfortable life for their families in case of their death.

2. Employee Benefits Package

One of the most recognized benefits businesses provide is group term life insurance. This can be provided in addition to group health insurance. These sorts of coverage can be critical for those with specific requirementsthose who rely on their work for financial security. With this type of insurance, the firm may tailor the base package, based on its financesthe demands of its personnel. Offering these rewards ensures that employees will remain devoted to their work.

Also, enhancing employee coverage would play an important role in ensuring their well-being.

3. Tax Benefits

Section 37(1) of the Income Tax Act permits the company or business owner to claim tax reductions on paid premiums of group life insurance, thereby lowering the entire tax liability.

4. Affordable Premiums

Group term insurance allows businesses to give employees significantly reduced premium prices than if they would have to pay for the same individual policy from their wallet.  Besides, most insurance companies provide considerable discounts on annual rates if the company fulfils a certain number of covered individuals under one group term insurance. This may be a significant benefit for businesses, since it lowers costslets them offer workers what is frequently seen as a critical financial safeguard.

Group Life Insurance Explained | Insurist

Benefits for Employees

Here is a list of benefits offered by group life insurance policies to employees:

1. Free Coverage

Employers often pay for group term insurance coverage; thus, employees receive life insurance benefits for free. Even in organisations where employees pay a portion of the monthly premium, the cost is relatively low since group term insurance prices are significantly lower than individual life insurance plans.

The organisation or company follows the master agreement while purchasing a group life insurance plan for its staff or policy members. Workers who choose to receive the optional group insurance coverage often receive a policy confirmation, which they must provide to any future insurance provider if they leave their current job and their life insurance coverage is discontinued.

2. Optional Riders

Employersinsurance providers understand the need to provide adequate coverage to employeeswill assist them. At a lower cost, group life insurance allows companies to add supplementary riders, including accidental death payout, critical illness coverage,more, ensuring the insured has all the coverage they require.

3. No Medical Exam

In most circumstances, employees are not required to undergo medical examinations to be qualified for a group life insurance plan. Declaration of good healthfamily medical history is all that is needed to be included as a part of the standard group plan.
However, in some cases, an employee could be asked to undergo exams before applying for additional coverage under an ongoing group life insurance policy.

4. Tax Benefits

Money received as a death payout by the insured’s relatives or nominees after their unfortunate death is tax-free.
Also, if a part of the premium needs to be paid by the employee, he would get a tax benefit for the same under section 80C.

5. Peace of Mind

Term life insurance is a great option for those who are in their 20s or 30sjust starting their careers. Life insurance coverage can serve as an excellent form of financial security for your family if you ever become disabled or pass away unexpectedly.

So, it is important for your team members to consider group life insurance plans offered in the form of an employee benefits packageunderstand how term life insurance works, since it can not only help them save a good amount of money on their policy but also continue to be financially protected while earning in their career or raising a family.

Why Choose Group Life Insurance Policy?

There are a lot of attractive selling points when it comes to term insurance. Term insurance is cost-efficient, flexiblegreat for employers who want to provide assurances to their employees without breaking the bank. As we can see from the benefits listed here, a good policy can even go a long way in motivating employeesstrengthening team unity. If you’re an employer looking for term insurance, you should do more than simply look at value – you should look at all the features that your options offer, so you can choose something reliableof high quality.


Companies that have bought group term life insurance for their employees have found that it can be a preciouscost-efficient solution. These companies, who started offering group term insurance as part of their benefits package, have enjoyed problems such as increased employee loyalty, increased efficiency on the joblowered discounting rates by insurance providers. Employers who want to buy group term insurance should select a provider that will offer them the best benefits availableat a reasonable price.