Employers can offer several types of insurance benefits to employees. Medical benefits are the most common type of insurance an employer can offer to an employee. But some employers go above and beyond to offer group life insurance policies, which can provide insurance for certain expenses to employees of a business or organization.
Group Life Insurance
A group insurance policy functions similarly to an individual life insurance policy. This type of life insurance is a contract that will cover a large group of people, such as all employees of a business. The benefits of this type of insurance will likely be provided on an opt-in basis, meaning that employees may need to sign up for this benefit.
That said, a group insurance policy is an ideal option for employers who have the desire to offer additional benefits to employees. In particular, this type of insurance can be found with labor organizations or it can be compounded with retirement benefits and other employee benefits.
Common Benefits of Group Policies
There are a few specific benefits that can be found with group policies. For example, one of the biggest advantages of a group insurance policy is an income-tax-free death benefit for employees. These policies also enable employees to add additional coverage for dependents, which may not be possible on individual insurance plans.
Who Is Eligible for Group Policies?
In general, the people who are eligible for a group insurance policy are employees who work for an organization. Depending on the rules of the business related to benefit eligibility, it may be the case that an employee must work for the company for a certain amount of days before they can sign up for the group insurance policy.
The eligibility process for a group policy is much easier than an individual policy, particularly in terms of medical qualifications. Unlike an individual life insurance policy, there are minimal or no medical underwriting qualifications that must be met for a group policy.
What Else Should You Know About Group Policies?
Although group policies can be extremely beneficial to employees, it should also be noted that a group policy is not as comprehensive as an individual life insurance policy. For example, a group policy will offer less coverage overall, which means that the payout, if the policy is used, will not be as robust as an individual policy.
However, even though the coverage is not as well rounded as an individual life insurance policy, it’s often easier for people to qualify for group policies. This is because employers offer group policies directly, which makes it easier to become eligible for this type of insurance. This may be ideal for those who cannot qualify for an individual life insurance policy for any reason.
Group insurance policies are offered by employers who want to provide additional benefits to employees. A group insurance policy is easier to qualify for than an individual life insurance policy, which may be preferable for some individuals who may not otherwise qualify for a life insurance plan. Please contact ISU Armac to learn more about your insurance options today.