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Group Term Life Insurance Policy:

Group Insurance is a type of insurance that is specially designed to offer life insurance cover to a group of people under a single life insurance policy. There is a group of insurance plans available in the market for a group of family members or employees of a company or members of a particular professional group, customers of banks, NGOs, non-banking financial institutions, and microfinance institutions, etc.

Group Term Life Insurance Policy

What is Group Term Life Insurance?

Group Term life insurance policy is a type of life insurance policy that provides coverage to a group of people under a single group term life insurance policy. Group term life insurance is a contract between the insurance company and the Corporate Company in which the life insurance company promises to pay the claim in the event of death of any employee of the corporate company covered under the group term life insurance policy. The premium for the group term life insurance policy would be paid by the Employer but the claims would be paid to the nominee of the employee in case of death of the employee due to an insured peril.

Features of Group Term Life Insurance

The following are the features of group term life insurance policy

  • Age Limit: The minimum age to enter is 18 years and the maximum age is from 65 to 69 years
  • Add-on covers: Add-on covers are provided as riders that insure for critical illnesses, accidental deaths, disabilities, etc.
  • Term Policy: If employee dies in an accident, the group life insurance gives the total guaranteed Amount to the candidate selected by the deceased individual.
  • Coverage: A pre decided sum assured is paid to the beneficiary of the insured in the event of death.
  • Premium:  Premium payments are made by the employer or in by the employee salary during his term. Premiums are low when brought at a young age.
  • Policy Term:  policy has one year limit. After that, it must be renewed every year.
  • Number of Member: In group term life insurance, the minimum size of the group is 50 members.

Benefits of Group Term Life Insurance

According to group term life insurance meaning, Group Term life insurance policy provides coverage to a group of people under single group term life insurance policy. Group term life insurance provides various benefits to the customers. The below are the some benefits of group term life insurance policy.

Default Insurance Cover:

A group term life insurance policy provides insurance cover to members simply by being part of the group. It provides basic insurance cover for those who do not have a personal life insurance policy.

Tax Benefits:

Group Term Life Insurance plans provide tax benefits to both employers and employees. According to prevailing Tax Laws death benefits are tax free under section 10(10D) of income tax Act, 1961.

Gratuity Funding:

Employers are approved with a systematic method of building up funds for their potential gratuity liability towards the workers. A group insurance policy assists the employers and offers life insurance coverage to employees.

No medical check-ups:

In group term life insurance plans, Employees are no need to go for a medical check-up to get insured.

Low Cost:

In group term life insurance plans, the premium costs are much lower as compared to individual policies..

How Does a Group Term Life Insurance Work?

Group life insurance scheme works essentially the same as an individual term life policy:

  • A group administrator is issued a master policy upon which he pays an initial premium.
  • This initial payment covers all the members of the group participants for one year.
  • Monthly or annual payments keep the policy active.
  • The insurer pays a death benefit to a nominee of policyholder for most causes of death.
  • An option to choose the sum assured is provided to group participants. This sum can either be a lump sum amount or could be connected to salary account or a loan account, etc.
  • Once the policy holder has paid the premium, the members are covered for tenure of one year from the date of commencement of the policy.
  • Policies expire after a certain period, so the group life insurance plans are annually renewable.
  • The premium is charged based on the changes in the size of group and age allocation of the concerned age group.

Who is Eligible for Group Term Life Insurance Policies?

Most businesses provide their workers or employees with group term life insurance, which guarantees the financial protection of an employee's family even after policyholder’s death. Group term life insurance policies are offered to the following groups of people:

  • Employer-employee groups
  • Non employer- employee groups
  • Banks
  • Non-banking financial institutions
  • NGOs
  • Professional groups
  • Microfinance institutions

Group Term Life Insurance Premium Calculator

The group term life Insurance Premium Calculator can be used to know the premium of group term life Insurance policy. The factors affecting the group term life insurance premium are age, gender, sum assured, lifestyle, occupation, etc. A group life insurance policy premium calculator tool provides the premium for your life insurance policy according to the data entered by you.

The group term life insurance premiums are payable through the premium calculator which determine the Life insurance companies available on our website. The amount of premium is also calculated on a required basis, the group life insurance calculator helps you fight the risk of your lives with insurance coverage for death occurring at a given age level. The premium for the group term life insurance policy would be paid by the Employer but the claims would be paid to the nominee of the employee in case of death of the employee due to an insured peril.

The best group term insurance plan in India can be found on the online portal while choosing the best term insurance plan is the one that offers the maximum coverage at affordable premiums and with all the possible add-ons. Some Group term plans offered by the insurance companies are HDFC group term insurance, ICICI Group Term Insurance, TATA AIA Group Term Insurance, Bajaj Allianz group term insurance plans, other companies offers the group term insurance plans.

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