Group Term Life Insurance

Any legally recognized group or organization with a minimum of 7 individuals can purchase Group Term Life Insurance to provide accident care benefits to its members.

Companies and Corporations: Small or medium enterprises, Large corporations, Private limited companies, Public limited companies, Multinational corporations

Business Entities: Partnership firms, Sole proprietorships

Non-Governmental Organizations (NGOs)

Associations and Societies: Professional associations, Trade unions, Cooperative societies, Clubs, Other registered groups

Government and Public Sector Units: Government departments, Public sector undertakings

Educational Institutions: Schools, Colleges, Universities, Other educational institutions

Professional Groups: Chartered Accountants (CA), Architects, Company Secretaries (CS)

Banks and Financial Institutions

Startups: New and emerging businesses

Conditions for Eligibility:

• The primary purpose of forming the group should not be to obtain Group Term Life Insurance.
• The age of the group does not matter for eligibility.
• There does not need to be an employer-employee relationship.
• Evidence of the relationship between the group and its members is sufficient.

Minimum 7 members

Main Benefits:

• Death Cover

Additional Benefits:

• Critical Illness Rider
• Terminal Illness Rider

Group Term Life Insurance benefits employers by ensuring financial protection for employees’ families in the event of death or disability. This support demonstrates the employer’s commitment to employee well-being and responsibility, leading to enhanced employee loyalty, satisfaction, and retention. It also aids in attracting top talent and offers tax advantages.

No

• Number of Members: The total number of individuals covered under the policy.
• Coverage Amount: The sum insured for each member, affecting the overall risk.
• Occupation Risk: The nature of the work performed by the insured members, with higher-risk occupations typically attracting higher premiums.
• Claims History: Previous claims experience of the group can impact premium rates.
• Optional Benefits: Additional coverages and riders, such as Critical Illness Rider, can increase the premium.
• Geographical Location: The location where the insured members are based can influence the premium due to varying accident rates and healthcare costs.
• Industry of Organisation: The industry in which the organization operates, as certain industries may have higher associated risks and thus higher premiums.
• Industry Mortality Rate: The industry in which the organization operates, as certain industries may have higher associated risks and thus higher premiums.

If an employee leaves the company, they may lose their Group Term Life Insurance coverage. Employee may continue coverage subject to mutual agreement between Group & Insurer and part of Policy Conditions.

Many Group Term Life Insurance plans offer flexible options that allow employees to choose different levels of coverage, add-ons, and additional benefits to tailor the plan to their specific needs and preferences.

No, Group Term Life Insurance plans can vary significantly between companies. Each company has its own financial and human resource budget, planning, culture, and policies, which influence the benefits chosen under their Group Term Life Insurance plan.

Companies can add new employees and remove those who leave on a monthly basis. New additions are charged on a pro-rata basis, and premiums for leaving employees are refunded on a pro-rata basis, subject to no claims being made by the respective leaving employee.

• Coverage Amount: Determine the sum insured for each member based on their role and risk exposure.
• Inclusion of Family Members: Decide if family members will be included in the policy and to what extent.
• Occupational Risk: Assess the nature of work and associated risks for different employee categories.
• Optional Benefits: Consider additional coverages such as medical expenses, hospital confinement allowance, and accidental medical reimbursements.
• Exclusions: Understand and customize the policy exclusions based on organizational needs.
• Geographical Coverage: Determine if the policy will cover accidents occurring outside the primary location, especially for traveling employees.
• Claim Process and Handling: Ensure a streamlined claim process with dedicated support for efficient handling and quick settlements.
• Premium Payment Options: Decide on the frequency of premium payments (monthly, quarterly, annually) and explore options for installment payments.
• Previous Claims History: Review the organization’s previous claims history to anticipate potential future claims and adjust coverage accordingly.
• Legal and Compliance Requirements: Ensure the policy complies with local labor laws and industry regulations.

It may be customized from one insurer to another as per group needs.

Yes, it is an additional voluntary benefit that a group chooses to provide its members.

Generally, it is not allowed, but specific insurers may choose to provide such a facility under certain circumstances.

For first-time policy: Member list with names, birth date, age, gender, relation, coverage amount, group identification code, and coverage amount.

For policy renewal: Member list as above, claim dump & MIS summary, active members list, existing policy document with annexures, or any other required information.

No, every insurer can customize coverage, conditions, and exclusions of a proposal, subject to agreement in pricing.

No.

Term Life Insurance is benefit-based. In the case of accidental death, all term life insurance policies, whether taken by the employer or employee, will pay a claim if the cause of death is admissible under all policies.

The premium of a Group Term Life Insurance plan is treated as an expense deductible from the company’s profit and loss. Employers can claim the premiums paid under this plan as a business expense and claim a tax deduction under Section 37. Employees cannot avail of any separate deduction for the same.

A pre-policy medical check-up is not essential within the free cover limit.

No, Term Life Insurance policies are benefit-based and do not have claim excess/deductibles. The insured receives the full coverage amount at the event of a claim.

Typically, all full-time employees of a company are eligible for coverage under Group Term Life Insurance.

Coverage amounts can vary but are often based on a multiple of the employee’s salary (e.g., 1x, 2x annual salary).

Yes, in most cases, employees can choose to opt out of the coverage if they prefer.

No, coverage under Group Term Life Insurance usually ends when the employee leaves the company. However, some policies may offer a conversion option to an individual policy.

Beneficiaries need to submit a claim form along with the required documentation (e.g., death certificate) to the insurer.