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5 Questions To Ask Yourself Before Buying Group Life Insurance

A buying group term insurance plan is an insurance policy taken by an employer to cover the organisation’s employees. It is a benefit and financial security plan that helps the employer cover the employees against death or disability in case of an accident or illness. Besides being tax-free, group term insurance plans have various benefits such as tax benefits, coverage limits, and age requirements.

All group insurance plans are not equal. Some organisations offer the best coverage at a reasonable cost while other companies charge an arm and a leg for the same benefit. The same applies to group life insurance policies. If you’re an employee of one of these companies looking to cover your family with term life insurance, you’ve come to the right place.

This blog will cover everything you need to know about group term life insurance policies: their features, benefits, eligibility criteria, etc. And most importantly – whether they’re worth it or not in your case.

Features of Group Term Life Insurance Plans

– Type of coverage: A term plan provides the range you need for a set term duration. You can opt for a single-term insurance plan or a joint-term insurance plan.

– Annual premium: Term insurance policies usually come with an annual premium. This is the sum of the sum insured and the policy’s term. The term insurance coverage also comes with an additional sum insured, known as the grace period amount, which is a sum assured on the insured person’s death up to the policy term.

– Cancel income policy: Most term insurance policies have a cancellation benefit in case of illness or accidental death of the insured person within the term of the policy. This benefit varies from plan to plan, but it helps cover funeral expenses and other beneficiaries’ income if the group life insurance policyholder dies during the policy term.

Benefits of Group Term Life Insurance Schemes

– Group term insurance policies offer employers several advantages over individual life insurance policies, such as lower premiums and the financial stability it provides.

– Employers can also choose from various group life insurance schemes that suit their specific needs. These schemes provide a financial safety net for businesses with high staff turnover or companies with many part-time employees. In addition to these benefits, group-term insurance schemes are an efficient investment tool for businesses of all sizes. They benefit from economies of scale, which enables them to negotiate favourable terms and cheaper insurance coverages.

– Finally, the tax benefits offered by group term insurance policies make them an ideal financial instrument for companies with high employee turnover or those with many employees abroad.

Overall, group-term insurance policies provide organisations with a reliable financial support mechanism to safeguard the health of their employees and avoid employee bankruptcy. They’re an excellent financial security blanket for businesses of all sizes no matter their size or industry.

How Does a Group Term Life Insurance Plan Work?

Group term life insurance plans offer more benefits and coverage than single life insurance plans.

-Group term life insurance plans are ideal for businesses with a large number of employees. The benefit of group term life insurance plans is the added security it provides to the employees, especially in case of death. After all, the death of an employee is an uncertain event, which group term life insurance plan can cover the financial burden for the employees and their families.

-A group term life insurance plan can be customised to meet the specific needs of your business. In this case, you’ll benefit from the ability to take up individual policies for members of the group plan as per their individual needs and requirements.

-As a bonus, group-term life insurance plans are an affordable way to protect your employees’ families in case of an unexpected death. This makes them a good choice for businesses looking to provide financial security for their employees and their families without breaking their budget.

Who is Eligible for Group Term Life Insurance?

– Group term life insurance can be purchased by individuals, couples, and families.

– Individuals can purchase group term life insurance to cover the death of a family member or individual in the group. Couples can purchase group term life insurance to cover the death of one partner.

– The coverage is typically more expensive than individual life insurance, but it can provide greater peace of mind.

– You can combine group term life insurance with other types of insurance to create a more comprehensive plan.

– It is essential to shop around to find the best rates and coverage for your needs.

– It is essential to speak with a life insurance advisor to get on the right path. They can help you weigh the benefits and drawbacks of group term life insurance and make an informed decision about the best coverage option that fits your needs and financial situation.

Before purchasing group insurance plans, it’s essential to understand the plan’s eligibility criteria. The minimum age of 18 years is required for group insurance plans. However, children up to the age of 15 years can be covered under the program if they have income from a source other than their family income and are eligible for social security benefits in the same year.

To be eligible for a group insurance plan, an individual must be a citizen of India or a permanent resident of the country. Apart from this, you also need to have income from a source other than your family income.

Are there any restrictions on who is eligible for Group Life Insurance?- What are the benefits of Group Life Insurance?- How does Group Life Insurance work?- What are the eligibility criteria for Group Death Insurance?

What Documents are Required to Buy Group Insurance Plans?

Before buying group insurance plans, it’s essential to understand the documents required to purchase group insurance plans. You must provide proof of identity, age, and residency in this case.

Lastly, you will need to provide evidence of insurance insurability. These are the documents that prove your eligibility for group insurance policies. If you want to buy group insurance policies with the minimum requirements, then it’s essential to follow the guidelines correctly.


The group term life insurance plan can significantly benefit employees and be an ideal solution for group insurance coverage. If you want to provide employees with group term life insurance coverage, the questions mentioned above can help you decide on the best plan for your organisation. While life insurance plans vary from individual to individual, the questions discussed above can guide you in the right direction.

We hope the information mentioned above helps you understand the basics of group-term life insurance plans better.

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