Importance of Having A Group Insurance Policy

The backbone of any high performing business is its employees and their happiness. As long as employees are pleased and satisfied with their work and employer, workplaces will always have a productive environment.

The satisfaction of an employee depends on a lot many factors including financial security, varying tasks, career growth, and recognition. A Group Insurance policy helps take care of the financial security part of the employees. As an employer, thus, you can choose from different group term life insurance options to protect your employees and their loved ones from the uncertainties of life.

Group insurance policy offers several benefits including life coverage to all employees included under the group insurance policy undertaking, irrespective of their age, gender, socio-economic background or profession. Here is a brief description of a group insurance policy and its importance for organisations and businesses today.

Under a group insurance policy, formal insurance groups consist of the members of an organization, corporation or company. The employer (organization) purchases the group insurance policy that covers the organization’s members (employee).

If you are an employer, then you know that your employees are valuable assets to your organization. For the same, you need to make sure that your organization attracts and retains the top talent available—an easy way to do this is to purchase a group insurance policy.

In today’s uncertain world, when you offer your employees the benefits of a group insurance policy, it shows that you appreciate them for their loyalty and commitment towards the organizations’ goals.

Under group insurance policy, the sum assured or coverage is provided as a pay-out to the family of the deceased employee, due to untimely death during the employment tenure with the organization.

Once an employee completes five years of service, they become eligible for gratuity (subjected to applicable laws.) The group insurance policy offers investment options to the organization to help create a gratuity corpus.

A group insurance policy can cover the outstanding dues or loans (such as home loans or personal loans) of the participating members, in case of unfortunate demise or disability.

With a group insurance policy offers, companies can attract and retain their employees. This also improves the business’ brand image.

A group insurance policy has a straightforward and simple insurance renewal process. It is mainly because all the different policies under a group insurance policy get processed as a single policy, making the whole renewal process seamless.

You, as an employer, can get all the members of your organization secured under one single group insurance policy. There is no difficulty in maintaining multiple insurance plans for every employee.

The group insurance policy covers a large number of people, thereby reducing the risk factor. Hence you can avail of cost effective group policy insurance premium rates.

With a comprehensive group insurance policy and services, organizations ensure that all its employees are safeguarded against unfortunate events. Not only does a group insurance policy protect your employees, but it also shows that you, as an organization, care about their needs. This increases overall employee satisfaction.

To the individuals associated with the organization, a group insurance policy serves as an add on beenfit. You can have various coverage slabs based on salary or contribution

If you are an employer, a group insurance policy helps you meet your statutory obligations

The premium paid for a group insurance policy helps you avail tax benefits in the form of tax exemption under ^[2] section 37 of the Income Tax Act . So, you can save a substantial amount of money when participating in a group insurance policy.

Dedicated claim settlement teams handle the group insurance policy. Hence, claim settlements have lesser restrictions and faster request processing.

when you participate in or purchase a group insurance policy ^[1], be careful about these things:

1.The manager/ administrator of the insurance groups will only be issued one master group insurance policy in the name of the group, for example, the organization or company.

2.If you have participated in a non-employer-employee group insurance policy, then you are entitled to get an insurance certificate for your records. This insurance certificate should include:

• The List of Benefits
• The Charged Premiums
• The Terms and Conditions

3. You could lose your cover as it ceases when you leave the group. In case you, as an employee, have either decided not to opt for a group insurance policy or if you have left the organization.

4. The insurer should offer you continued coverage under an individual policy when you leave the group.

5. The manager/ administrator of the insurance groups must disclose the premium rates and terms and conditions of the group insurance policy that includes the premium discounts offered to the group.

6. The manager/ administrator of the respective insurance groups also has to disclose any administrative or related charges collected from the members that are over and above the premium charged by the group insurance policy provider.

Additionally, you can also check the latest ^[3] IRDAI guidelines for group insurance policy for better clarification.