Group Life Assurance is an insurance that covers a group of people, usually they are members of a society, employees of a common employer, or professionals in a common group. Group Life Assurance pays out a lump sum death benefit to the employees’ family or next of kin should that individual die whilst employed by the organisation.
· There must be a group of people to be insured which should have something in common other than the purpose of obtaining insurance
· There must be a Master Policy Holder who will retain the contract on the behalf of the member and the carriers
· Such covers are typically available at a discount to the respective individual rates
Group Life Assurance remains in force until your employment is terminated or until the specific term of coverage ends. There is also an option of converting your group coverage to an individual policy if you leave your employer. Many employees choose not to do this as conversion premiums tend to be much higher than premiums for comparable policies available to individuals.
Benefits for employers - A more competitive and attractive benefits package helps recruit and keep the right staff. Premiums will normally qualify for tax relief depending on scheme choices, including Excepted Group Life policies, also known as relevant life policies. Usually costs less than 1% of payroll depending on the level of cover.
Benefits for employees - Peace of mind for them and their loved ones. Lump sum and dependants' pension benefits can be paid without waiting for probate and free of inheritance tax. This valuable cover is not classed as a benefit in kind.
Group Life Assurance is one of the many employee benefits available for employers to offer their staff. Other benefits include pension schemes, group income protection schemes providing a replacement income if an employee is off work long term and group medical insurance plans.
The following additional but optional benefits can be taken out: