If you’re an employee working at an organization, you’re eligible for a group term insurance plan, usually offered by your employer to ensure the safety of your loved ones. This insurance policy provides a death benefit to your dependents in case of your unfortunate demise.
A term plan protects one’s family from all financial burdens and a group term policy is a coverage offered to a group of people. It offers financial independence to all the members of the group by safeguarding the future of their families through adequate monetary benefits offered under the policy.
These policies have become a common norm in the benefits offered in form of packages to employees by the employer. Most of the reputed organizations offer group term insurance to their employees and members in addition to the employee provident fund.
Benefits of Group Term Life Insurance for Employees
Insurance Cover
With a group term plan, the members of a group can enjoy insurance coverage with a guaranteed base pay to the members who don’t own pre-existing health insurance.
Gratuity
Gratuity is a sum of money offered to employees at the end of their employment period. A group term insurance allows employers to plan their future debt to pay employees in a highly structured way. This allows employees to enjoy their life insurance with greater freedom.
Tax Benefits
A group term insurance policy also provides tax benefits to both employees and employers. According to the present norms of the Income Tax Act of India, the death benefit offered under the group insurance is exempted from taxation as per Section 10(10D).
Personalization Options
With a host of available integrations, a group term insurance plan can be personalized to meet your staff’s requirements with additions such as accidental death benefit, education grant, repatriation grant, and a lot more to extend your policy’s coverage.
No Medical Examination Required
To be eligible for group term life insurance, you don’t have to undergo any kind of medical examination at all. Most of the preferences of the plan are the same for all the members of the group, which eradicates the need of calculating the risk of individuals based on their health conditions.
Cost-Efficient
As group term insurance covers multiple people under a single plan, the premiums required for these plans are exceptionally lower as compared to traditional alternatives, which makes them highly cost-efficient and affordable.
Benefits of Group Term Life Insurance for Employers
In addition to the employees, a group term insurance plan also offers an exclusive range of benefits for the employers. Here’s a quick rundown of the various benefits that you can enjoy through a group term plan as an employer:
Employers gain help in managing their funds under a group insurance policy, which means the premium payments are strategically planned that reduce the burden on the employer
Depending on the performance of the funds, employers can also choose to gain refunds with ease
Group term insurance plans are easy to manage and cost very little as compared to individual plans
If an investment performs better and receives higher profits, the burden on employers decreases significantly
Several term plans may also provide life cover and additional benefits to the employer
With such an impeccable list of benefits for both employees and employers, group term insurance is surely an ideal investment option to safeguard the future of your member’s families and dependents. Moreover, it also helps with employee retention for the organization.
Best Group Term Insurance Plans Available in India
ICICI Pru Group Term Plus
The Group Term Plus plan offered by ICICI Pru provides adequate life cover to your team members. It offers a death benefit to the affected family in the event of the unfortunate death of the member. The plan is offered by a Master Policy issued to the employer or the administrator of the group. Additionally, the premiums are also required to be paid by the employer, which can be either graded cover amount or flat. The former offers ranging life covers based on grades and the latter features a fixed coverage for all the employees or members of the group.
HDFC Life Group Term Insurance Plan
The HDFC Life Group Term insurance plan provides a comprehensive life cover to a group of people, including one master policy that covers all the members of a group of employees of your organization. The plan can be renewed annually and the administrator can choose to add or remove members at any instant of time throughout the year. The plan offers an assured sum payable to the member’s nominee in the event of unforeseen death of the covered member. Additionally, employees can also choose riders to extend their coverage with options like disability rider, accidental death benefit, critical illness, and a lot more. You can even cover your spouse under the same policy with a very simple and intuitive enrollment process.
Canara HSBC Oriental Bank of Commerce – Group Advantage Plan
The Group Advantage Plan offered by Canara HSBC Oriental Bank of Commerce is a group term insurance plan that features yearly renewals. It’s a perfect plan to cover your group members against uncertainties of life and protect their families financially. In case of any eventuality, the plan offers an adequate death benefit to the nominee chosen by the covered member. Moreover, it’s available at a very affordable rate and allows you to attract and retain members. This also works great in improving the satisfaction of your group members by offering them financial security at ridiculously low costs.
The Takeaway
A group term insurance policy is not only better in terms of affordability, but also provides adequate protection to group members. Now when you know what is term insurance and what group term insurance is, if you’re an employee or group administrator, you should consider getting your employees or members covered under a group term plan and provide them greater satisfaction with working under your organization. It’s proven to enhance the employee attraction and retention of your enterprise.
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