A Win-Win for Employees and Employers Alike: 3 Situations That Call for the use of Group Life Insurance

Group life insurance, as its name implies, provides insurance for a group—typically, but not necessarily, ten or more employees—under a master contract between the insurer and the employer. Technically, the insured individuals are not part of that contract. Planners should note that almost 40 percent of all life insurance in force in this country is issued on a group basis. So when is the use of this device indicated?

  1. When an employer wants a means of acquiring an employee benefit that most employees appreciate, and even expect.
  2. When insurance is difficult to obtain at standard rates because a key employee has a health condition or a dangerous avocation.
  3. When an employer would like to provide life insurance protection in amounts up to $50,000 in a cost effective manner for shareholder-employees as well as others.
Reproduced with permission.  Copyright The National Underwriter Co. Division of ALM

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