Is Group Life an Employee Benefit?
Group life insurance is a type of policy that can be purchased by an employer for the use of its employees. Group life insurance is a benefit that many employees appreciate. It can add value to a benefits package that includes other features like health insurance and a retirement plan.
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Qualifying for Policy
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Nearly one-third of adults in the United States do not have any form of life insurance. Many of these individuals do not have life insurance because they cannot get approved for a policy by a life insurance company. This happens because the individual has some type of health problem and the insurance company is not willing to cover them. With group life insurance policies, anyone in the group is automatically accepted by the life insurance company regardless of health. For employees with health issues, this can be a valuable benefit to them.
Affordable
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One of the major benefits of getting life insurance through a group is that it makes the premiums more affordable. Another reason that many people do not get life insurance is because of the cost of the premiums. When you get coverage with a large group, the premiums will usually be less expensive than what you could find when you buy coverage as an individual. Most insurance companies are willing to offer a bulk discount in exchange for securing the group policy.
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Portability and Convertibility
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Another benefit that comes with this kind of insurance is that employees can choose to take the coverage with them if they leave. Most group life insurance plans allow the policyholder to convert the policy into a whole life policy and take it with them if they go. They also could choose to simply keep the same policy and just take over the premium payments when they leave an employer. This is a benefit that can last for the life of the employee.
Not Required
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Offering group life insurance to your employees is not required. Even though many employers do offer this type of plan, you could get by with only offering them health insurance and access to a retirement plan. While it is not required, it can be another tool that you use to recruit and retain quality employees to your business. For the relatively small cost of the premiums, it provides a large value to the employees.
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