How to Save Money on Group Term Insurance Plans?

How to Save Money on Group Term Insurance Plans?

If you are a salaried individual, you surely must have heard of group insurance plans offered by employers. Due to such uncertain times, the last thing you would want is to leave your dependents without financial backup. But worry not because group term plans provide that security to your family at a low cost.

Here’s everything you need to know about group term insurance and how you save money with it!

What Is Group Term Insurance Plan?

A group term insurance plan is an insurance policy that covers more than one person and is usually offered as an employee benefit by most organisations. Employers provide the employee with the base term insurance cover at almost zero cost and enable the individual to get additional coverage by paying for it. Some organisations also extend the option to purchase insurance for the spouse and children of the employee. In the event of an unfortunate mishap, the beneficiary of the employee shall receive a lump sum payout to secure their finances.

Features:

  • Low premium rate
  • Ease of premium payment
  • Simple eligibility criteria
  • Extensive coverage with rider benefits

How Does Group Term Insurance Work?

Most companies offer such group insurance plans to their employee as a benefit for working with the organisation. You may have to meet certain eligibility criteria such as being a permanent employee to be covered under the policy. However, you shall be protected under the group term insurance policy as long as you are employed by the company. Once you quit the organisation, you cannot carry forward the coverage and hence, you won’t have any coverage. The employer decides aspects like the amount of death benefit, the option of increasing the base coverage, insurance for spouse and children, etc. Thus, one group term plan may not be similar to the insurance policy offered by another organisation.

Group Term Life Insurance Definition

Benefits of Group Term Insurance Policy

Go through some key benefits of being covered under the group term policy:

  • Financial security

Though term plans are cost-effective, many individuals might not be able to purchase one. But as many organisations now offer such group life insurance, you get term plan coverage at zero cost. Thus, your loved ones are financially secure from any untoward mishaps. In case your employer enables you to increase the base coverage, you can choose a higher sum assured at a low price and save money!

  • Personalisation option

Such group life insurance allows you to personalise the policy according to your needs. By adding riders to your group term plan, you can get access to additional coverage against certain risks. Some popular rider options are critical illness rider, accidental death rider, a permanent disability rider, etc. If such an unfortunate mishap comes your way, you shall get a lump sum or regular payout from the rider.

  • No medical checkups

Usually, group term insurance doesn’t require you to undergo medical checkups. Hence, you can be worry-free about increased premiums due to health issues or lifestyle habits.

  • Option to cover family

Organisations also extend the coverage to include family members in the insurance plan. But you should remember that it may come at an additional cost, as your employer shall only cover your insurance charges. But the premium quote could be more affordable than individual insurance plans.

  • Access to individual plans

Did you think that you couldn’t purchase an individual term plan if you had group insurance? That’s not true! You can easily have an individual life insurance policy that meets your future goals and is personalised to suit your insurance needs along with a group plan. Doing so can be much more beneficial as you shall lose your group coverage once you leave the organisation. Therefore, having the right individual life insurance with a group term plan can go a long way.

With the above pointers, you must have understood how beneficial group term insurance plans are. Such policies help you save up a lot as many policyholders tend to have no coverage at all. However, it is recommended to have an individual plan to safeguard your loved ones and avoid being completely dependent on group insurance. If you haven’t purchased one yet, use a term insurance premium calculator to buy one online and get lucrative premium quotes today!