Get quote if you agree to our Terms of Use and Privacy Policy

GROUP TERM LIFE INSURANCE (GTLI)

ABOUT

A group term life insurance policy is a term life insurance plan for the members of a recognized group. The policy covers the risk of premature death and pays a benefit if any covered member of the group dies during the policy tenure. The policy can be taken by an organisation covering its employees on the basis of employer employee relationship. It can also be opted by any group falling under the parameters set by IRDAI as a group.

The coverage duration of the policy is one year after which it should be renewed for continued coverage. Coverage under the group term life insurance policy continues till the individual is a member of the group.

The sum assured of the group term life insurance policy is determined by the company on the basis of number of times of their annual earnings and as allowed by the insurer. Premiums are determined based on the age of the members covered, the type of group, the sum assured opted for and whether any additional optional coverage benefits have been chosen or not.

GROUP TERM LIFE INSURANCE (GTLI)

BENEFITS

AFFORDABLE COVERAGE

A group term life insurance policy provides affordable term insurance coverage to the members of the group. The premiums charged under a group term plan are lower than the premiums charged under independent term insurance policies.

OPTIONAL COVERAGE BENEFITS

A group term life insurance policy can be customized with optional coverage benefits if required. Coverage benefits like accidental death benefit rider; critical illness rider o can be added to the policy at an additional premium. Moreover, the coverage scope of the policy can also be extended to cover the dependent spouse or kids of the insured members. These optional coverage benefits enhance the scope of the policy and make it customizable.

EASE OF AVAILABILITY + FREE COVER LIMIT

A group term life insurance policy can be easily bought by groups for their members. There is no individual medical underwriting of the members of the group and the policy is issued easily. This means that the group members do not have to undergo pre-acceptance health check-ups before they are granted coverage. As such, older members and members having a poor health, who cannot otherwise get covered under a term plan, can get covered under a group term liability insurance policy just because they are the members of the group buying the insurance policy.

The policy also allows a Free Cover Limit which allows additional sum assured to the insured members. The Free Cover Limit is the limit of sum assured up to which insured members do not have to undergo medical check-ups. This coverage limit is, therefore, freely available for insured members if opted.

LUMP SUM BENEFIT ON DEATH

If any of the covered member/members suffer premature demise during the term of the policy, the corresponding sum assured is paid to the nominated family of the member. However, coverage for the other members does not get interrupted. It continues till the coverage due date and claims are paid as and when they accrue. The lump sum benefit payable on death of the insured member can also help provide financial assistance to the member’s family.

ANNUAL POLICY RENEWAL

A group term life insurance policy is valid for one year after which renewal is required. When the policy is renewed, a fresh policy is issued wherein the number of members being covered, their revised ages, the sum assured, and the corresponding premium might change. If there have been lower claims in the policy year, the insurance company might also allow a premium discount to the group which helps in saving the premium cost.

CHANGE IN THE SUM ASSURED

The group term liability insurance policy also allows the group to increase or reduce the sum assured under the policy at the time of renewals. Thus, the group has the flexibility to choose an optimal coverage level for its members and even change the coverage every year if needed.

ACTIVELY AT WORK LOSS

A group life insurance policy covers employees who are actively employed with the organisation. If the employee is on a leave or sabbatical and the employee suffers premature death, claim under the group life insurance policy would not be admissible.

Search Insuropedia

Have a question? Ask or enter a search term?

Generic selectors
Exact matches only
Search in title
Search in content
Search in posts
Search in pages

Search Insuropedia

Have a question? Ask or enter a search term?

Generic selectors
Exact matches only
Search in title
Search in content
Search in posts
Search in pages