The group insurance policy cover is the single contract taken by a group administrator (i.e. a company, a society, etc.). The contract provides coverage to multiple beneficiaries (group members), i.e. the employees of the company. The administrator is responsible for the payment of the premium in respect of a group policy.
In case of any incident ( covered under the contract) with a member of the group, the member is free to file the claim with the insurer directly or can request reimbursement/compensation through the employer.
Covers the members under the insurance contract as long as they are a part of the group. If any member leaves the group, the insurance contract stops covering that person.
Read More: Type of Group Insurance Policies available in India
Case on Group Insurance Cover
TYT Pvt. Ltd. is a steel manufacturing industry. The management of TYT Pvt. Ltd. decided to take a group life insurance cover for the employees owing to the risks of accidents in the factory while working on machinery and boilers.
They approached a Life Insurance Company to get suitable cover. The insurance company asked the management to explain what extent of coverage they want to go for. They asked the management to decide each of the employee’s coverage depending upon the salary of the employee. Usually, life cover is two times the annual salary of the employee. Based on the total coverage, required for all the employees of TYT Pvt. Ltd., the insurance company provided a suitable quote and various other teams and conditions attached to the cover, e.g.: claim settlement procedure, additional rider information, etc.
The company took responsibility for the premium that needed to be paid in respect of group life insurance and the insurer issued a master contract of insurance for the records of the company. Provided all the employees with individual insurance cards to keep as proof of insurance for themselves, and also required to upload the beneficiary information on the required portal.
