Group Term Life Insurance

Get the perfect term life
insurance plan for your team

*T&Cs apply

Shield your employees from life’s unexpected curveballs

group term life insurance

Group Term Life Insurance plan, as implied by the name, is an insurance product crafted to provide life insurance coverage to a group of individuals under one policy.

Group insurance policies for employees provide a safety net for beneficiaries in the unfortunate event of the employee’s demise, offering financial security and independence. These policies offer a range of benefits, including uniform coverage for all members, tiered coverage based on different membership grades, and optional features such as coverage for outstanding loans, critical illness, and disability benefits for the insured group.

By offering this product, your employees can rest assured knowing that their loved ones are financially secure. This type of insurance plan acts as a reliable support system, offering peace of mind for both employees and their families, regardless of the challenges the future may bring.

What is Group Term Life Insurance?

Group term life insurance is a type of life insurance plan that covers multiple individuals or a group under one policy. The main goal is to provide financial protection to the beneficiary if the covered person passes away during the policy term. These plans are usually affordable because the risk is spread across a large group of people.

Term insurance acts as a temporary protection, such as covering financial obligations like mortgages or supporting dependents in the absence of the insured.

what is group term life insurance
types of group term life insurance

Types of Group Term Life Insurance

There are several types of Group Term Life Insurance plans available:

Employer-sponsored Group Term Life Insurance

This coverage is often offered as a standard employment benefit by employers. Typically, the employer covers the premiums, and the amount of coverage is typically based on a multiple of the employee’s salary.

  • Basic Group Term Life Insurance: Employers often provide this insurance as a fundamental benefit, offering employees a standard level of protection.
  • Supplemental Group Term Life Insurance: This option offers employees the opportunity to increase their coverage beyond the basic plan by buying an additional insurance cover. This supplemental coverage may include benefits like critical illness cover or a group personal accident rider. Typically, the employee bears the cost of this extra coverage.

Non-employer Sponsored Group Term Life Insurance

  • Association Group Term Life Insurance: This type of plan is provided through an association or organisation, allowing members to buy coverage at a reduced cost.
  • Affinity Group Term Life Insurance: Such a policy is akin to Association Group Term Life Insurance but is typically offered to members of a specific affinity group, like a credit union or alumni association.
  • Credit Life Insurance: This type of group term insurance policy is extended by lenders to borrowers, settling the borrower’s debt if they die before it’s fully repaid.
  • Wholesale Group Term Life Insurance: Such a policy is sold to a group, like a corporation or labour union, at a discounted cost. The group then allocates coverage to its members.

Features of Group Term Life Insurance

  • Such a plan extends life insurance coverage to multiple individuals through a single policy.
  • Premium payments are typically covered either entirely by the policyholder or significantly subsidized by the employer.
  • In the unfortunate event of the insured individual’s death, the sum assured is disbursed to the nominated beneficiary.
  • Group term life insurance plans provide cost-effective coverage due to lower premium rates.
  • These plans have a fixed premium and are annually renewable, offering continuous protection.
  • While all employees are covered under the same plan, the actual coverage is subject to limitations based on factors such as risk class and group size.

Advantages and Benefits of Group Term Life Insurance

Group Term Life Insurance indeed presents a win-win proposition for both employers and employees. Let’s explore the key advantages and benefits for each of them:

For Employees

Affordable or no-cost default coverage: Group life insurance plans offer economical insurance coverage to each member within the group. Compared to individual life insurance policies, group plans are cost-effective, providing employees with a default level of life cover, often as a perk.

No preconditions: Unlike individual life insurance policies that may require extensive considerations like lifestyle habits and medical history, group life insurance plans have no prerequisites for purchase. For instance, there’s typically no need for pre-medical screenings for group plans (up to a certain coverage limit).

Streamlined claim settlement: The claim settlement process for group life insurance policies is usually swift and hassle-free for the nominees. Employees or their beneficiaries simply need to submit the necessary documentation to initiate the claim settlement process through their insurer.

For Employers

Cost-effective premiums: Group term life insurance policies typically involve premiums paid by employers. By opting for group insurance plans instead of individual ones, employers can significantly lower their expenses while ensuring coverage for the same number of employees.

Enhanced employee retention: Group term life insurance serves as a valuable incentive, contributing to higher employee retention rates and fostering loyalty among the workforce. Employees are more likely to stay with a company for a longer time that provides such essential benefits.

Improved employee morale: The security and peace of mind offered by group term life insurance policies contribute to a positive work environment. Employees feel supported, allowing them to focus on their work effectively. This leads to higher morale and productivity.

For Employers

What’s not covered in Group Term Life Insurance?

Insurers may deny group term life coverage or benefits in situations such as:

  • Suicide: If a policyholder dies by suicide, their beneficiaries may not receive any benefits from the group term life insurance policy. Suicide is often considered an “intentional self-inflicted injury” by insurers, leading to denial of coverage.
  • Injury from dangerous activities: If an individual sustains an injury while participating in activities deemed “dangerous” (such as skydiving), their beneficiary may not receive any benefit from the policy unless such activities are explicitly covered in the policy’s terms and conditions.

Disclaimer: It’s crucial to thoroughly review the specifics of your Group Term Life Insurance plan to grasp the precise coverage details and any supplementary benefits it may encompass. By comprehensively understanding the extent of coverage provided by your Group Term Life Insurance plan, you can make well-informed decisions and guarantee that your employees’ loved ones are safeguarded. Take the time to carefully assess the terms, conditions, and exclusions outlined in your policy to ensure they align with your needs and expectations.

Eligibility for Group Term Life Insurance in India

Group Term Life Insurance offers valuable protection to various segments of the working population in India. Here’s an overview of eligible groups:

Employee-employer groups: This is the most common category, where employers offer coverage to their employees as part of the employee benefits package.

Non-employer sponsored groups: This includes professional associations, cooperatives, and similar groups that extend coverage to their members.

Financial institutions: Banks, non-banking financial institutions, and microfinance institutions may offer group term life insurance to their customers.

Professional groups: Professional associations comprising of chartered accountants, doctors etc., may offer this benefit to their members.
Eligibility variations: It’s important to note that specific eligibility criteria may vary within each group, alongside the general requirements for obtaining insurance in India.

Coverage amount may differ: Some plans offer uniform coverage for all members, while others provide graded coverage based on factors like salary or professional experience and grade.

Buying or Enrolling in a Group Term Life Insurance Plan

Here’s a step-by-step guide to enrolling in Group Term Life Insurance:

Why choose Onsurity as your Group Term Life Insurance Partner?

Group Term Life Insurance
Flexible payment options: Simplify your cash flow with our monthly subscription-based plans. No need to pay a lump sum upfront. Our plans cover teams starting as small as 3 or more members.
Group Term Life Insurance
Trusted by thousands: Join the ranks of over 5,000 businesses and 1,000,000+ members who trust Onsurity for their healthcare and insurance needs. We are India’s fastest new-age insurtech to unlock this milestone.
Group Term Life Insurance
Effortless claims process: Enjoy a smooth and efficient claims facilitation process with Good Doctors, our dedicated claims support team. They guide you through every step, ensuring a hassle-free experience.
Group Term Life Insurance
Comprehensive coverage: We provide more than just insurance – our comprehensive healthcare and wellness plans ensure your team is fully covered for all their healthcare and insurance needs.