Group Insurance Policy- Details & Benefits

The companies today have a problem retaining their manpower/ employees and to efficiently deal with this concern, HR department tries every possible method to retain their valuable employees. One of the best ways to do so is to avail group insurance for the employees/staff.

You Might Also Like To Read Tax Benefits of a Life Insurance Plan

What is Group Insurance?

The group insurance policy is actually a life insurance service specifically formulated to cover a significantly large group of individuals in a single contract. In a group insurance policy, the owner is the employer or a company, and the policy is meant for the benefit of its employees or staff of that particular company.

Why is Group Insurance Policy Not So Popular?

Although the group insurance policies are a major part of the insurance pool, yet many individuals do not really appreciate and incorporate their sponsored group benefits into their financial situation. As a result, they spend a lot out of money from their own pocket for another medical insurance policy.

One must know that a group insurance policy offers sufficient coverage in case of medical emergencies for the employee and his/her family irrespective of an individual’s gender, age, lifestyle, profession, and family background.

Benefits of Group Insurance

Although majorly speaking the benefits of the group insurance policy is very much similar to a life insurance policy. But in case of a group insurance policy, the benefits are wider and in most cases, not many people know about it. So here is a detailed list of the benefits of a group insurance policy.

It Offers Tax Benefits to Employers - Group insurance plans provide tax benefits to the owner/employer and also the employees can avail tax benefits. Moreover, the plan provides double benefits to its clientele and serves as an employee welfare plan and simultaneously works as an employee retention plan. These plans also extend the benefits and coverage to the family of the insured individual.

Offers Huge Savings to Employers - Group life insurance provides policy cover at a subsidized rate. Therefore, this plan makes it feasible for a large group of people to afford a life insurance policy. The premiums amounts are assessed by insurance companies, on the basis of the risk factor of the groups. The payment of premium amount can be contributed in 2 ways.

1. Either the entire premium amount is paid by the employer/company who bought the policy for its employees or staff.
2. A fractional premium sum is paid by the insurer and the rest is paid by the employees or staff.

It is Pocket-Friendly for Employees too – Many times, the sum of the insurance premium is divided between the employee and the employer. You will observe that the group insurance plans are about 30-35% economical than individual health plans. And, the premium amount paid by you is comparatively quiet.

Also Provides Coverage To Employees’ Family- If you have a group insurance plan, then your family is also secured under the same plan and you need not worry about having a supplemental coverage for your family. In most cases, adequate coverage to the family members is provided under the group insurance policy.

It doesn’t Require Medical Check-Ups –One of the best benefits of the group insurance policy is that you do not need to go for medical check-ups, neither for yourself nor for your family.