Life Insurance
Group life insurance is a product through which lives of more than one person are insured. Such product may be purchased for the entire family or group of employees. There can be other groups as well that purchase such policies. Veterans' group life insurance is an example of such policies. If an employer purchases group life insurance for its employees, then if the employee dies, an insurance amount based on his or her earning capacity would be paid to survivors.
If an individual were to purchase the same life insurance cover, it might have proved to be rather expensive. But insurance companies offer the same amount of cover at lower premium under group life insurance policies. This is because these insurance companies incur lower administrative costs for such work. Moreover, they get a single big client, i.e., the employer, who would be there with them for a long term.
Group life insurance policies are term policies. Therefore, these have to be renewed annually. If employee were to purchase term life insurance policies for self, he would have to undergo medical examination at the time of every renewal. But for group life insurance policies such examination is not necessary at the time of renewing, provided the policy is renewed regularly. Employees changing their job may, however, have to undergo medical tests for being covered under Group life insurance policy of the new employer.
Since employer is likely to assign the task of such insurance purchase to some professional, the terms and conditions in the life insurance product would be thoroughly scrutinized to ensure they are favorable to the employee. Administration department of the employer would also help the employee's family in claiming the amounts under the policy. But the biggest advantage of such cover provided by employer is that employee does not have to pay anything for it. It forms part of the perquisites that the employer may offer to employees. The premiums on Group life insurances are tax deductible.
Many business owners in today's tough competitive job market see and recognize the importance of keeping and attracting good employees. Giving them group life insurance is a nice economical way for a business owner give a quality benefit that their employees appreciate and value. Regardless how many employees business owners have, a group insurance plan has a well plan designed to protect their full-time workers. All of this can be made and accomplished through the ease and convenience of a simplified billing statement. There are many types of plans are available today. Just like Group Term Life is very affordable life insurance protection that is paid as a benefit by the employer. A good example is Lifeworks, it is a voluntary payroll deduction system or program for the employee. Business owner have the choice of a variety of benefit schedules.
An example of steady and well respected insurance plan providers is the State Farm. The State Farm has a Group Life insurance plan that can benefit a company and its employees. In most states, insurance can establish a nice plan for employee groups of 5 or more, while some states may require a minimum of ten employees. Contact your State Farm agent for eligibility requirements.
There are some advantages to the Employer like Federal income-tax deductible premiums. Desirable fringe gain and benefit to offer new employees. Reduced turnover, saving employer's money in hiring and training costs. Contributes to employee stability, loyalty, security, and higher morale. Valuable life insurance protection give and provided at a low group rate. There is also an advantage to the Employee: Valuable life insurance protection give at a low group rates. Right to name and change their beneficiaries at any time. Waiver of Premium Disability Benefit rider is also available at no extra cost.