Respected financial planners will tell you that life insurance is a valuable tool in securing your family’s financial future. However, the cost can be a deterrent for many people. Studies show that offering life insurance to employees can add value to their benefits package. That leaves many people wondering what sets group life insurance apart from a traditional policy.
What Is Group Life Insurance?
As its name implies, group life insurance is designed as a package to be offered to a group of people. This is in contrast to an individual policy that covers only a single person. Much like when health insurance is purchased for groups, the risks are spread out over a group of people. This helps keep rates low so coverage is affordable.
What Are Some Advantages of Group Policies?
Group life insurance offers advantages to both employers and employees. A few of the reasons businesses choose to offer coverage include:
- It can help you attract and retain highly-qualified employees
- It is an affordable benefits options
- The first $50,000 of coverage is generally tax-free to employees
- The term of coverage can be limited by an employee’s tenure
- Policy specifics and who pays for coverage can be customized based on needs
- Coverage amounts can be set levels or based on employee compensation
- AD&D coverage can be easily added to policies
There are numerous pieces that can be added to employee benefits packages. Once you know more about group life insurance, it is easy to see why including it can be a sound business decision.