Group Term Life Insurance

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The coverage of the group life insurance policy is dependent upon the terms and conditions at which company has taken the policy. Here are the different types of group insurance policies which come with life insurance cover:

  • Group Term Life Insurance: In this policy, a lump sum benefits are payable to the beneficiary in case of the death of the employee during the period of the plan.
  • Group Gratuity Plan: This plan helps the employer to pay off his liability toward gratuity as well the life of the employee. Whenever an employee retires, resigns, or leave the company after completing 5 years of employment with the company, the gratuity is paid using this fund.
  • Group Investment-Linked Insurance Plan: Apart from life benefits, this plan offers investment benefits as well as protection to the employees. Apart from insurance benefits, the investment is done market products as well.
  • Group Leave Encashment Benefits: Like the gratuity plan, this plan helps the company in paying out the liability of leave encashment to the employees with the life insurance benefits.
  • Group Mortgage Redemption Assurance Scheme: This group insurance plan provides insurance protection to the employees who had availed a loan in addition to life insurance benefits.
  • Group Critical Illness Rider: This plan comes with additional rider along with your group insurance plan that gives protection for any critical illness apart from the life benefits.

Case on Cover of Group Life Policy

QWT Pvt. Limited is a textile manufacturing company with 600 employees working with them. They recently bought a Group life insurance plan with gratuity and critical illness cover for all the staff so that all their employees are protected and necessary financial compensation can be provided to their family in case of any unfortunate events. This is how the group plan helped the company as well as the employees on different occasions.

Mr. Ram Nath, a supervisor in the factory, was working with the company for last 10 years. One fine day, while working in the factory, he got a chest pain and was rushed to the hospital immediately. But unfortunately, he expired on the way to the hospital itself due to sudden heart attack. Ram was married and had two kids. His beneficiaries were paid a compensation of Rs. 1 Crore by the group insurance policy so they can sustain their life independently.

Ram Nath had been working for QWT for more than 5 years. Thus, he became eligible for the gratuity as well. The group insurance also covered the gratuity benefit which is payable in addition to the life cover paid by the insurer.

Mr. Alok Sharma, the Head of the Marketing Department of the company. While working in the office, one day Alok felt a stinging pain in his chest and was hospitalized. On examination, it was detected that he had suffered a heart attack and must go through treatment for the same. The group life insurance plan with critical illness rider proved to be a savior for him. The policy paid a lump sum amount to Alok as a huge relief, which he can use for the majority of his treatment costs.

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