Future Generali

As an employee can I avail a term life insurance plan through my employer?

Group term life insurance

Companies across the world face a common challenge – employee attrition. For most companies, talent is a rare commodity that’s trickier to scout for and retain in their organizations, given the rapidly changing job market. Talented employees too, are aware of the worth of their job skills and the opportunities that can be leveraged upon for better compensation and benefits. So, it is in the company’s best interests to retain talented employees who perform highly and entitle them to those additional benefits that can not only keep them happy and motivated, but also help companies to edge past their business competitors. Employee term life insurance, also known as the Group term life insurance , is one such mutually beneficial arrangement between the employer and the employee that is fast gaining traction as a preferred method for employee retention.


What is Employee Term Life Insurance?

It is an employer provided comprehensive term insurance policy to its employees, wherein the employer buys the policy and pays a certain part of the policy premium for employee’s benefit. The employer purchases a single policy for a large group of people in the organization and so technically, the employer remains the policyholder of. The employee becomes the insured and is entitled to the term policy’s comprehensive coverage. In case of the employee’s demise, the death benefit of the policy is paid to the employee’s beneficiaries as nominated by him, and not to the employer. The minimum entry age for most policies in the market ranges between 18 years and 60 years.

What are the Benefits of Employee Term Life Insurance?

Its soaring popularity among the large organizations is an indicator of the comprehensive coverage and benefits it provides at affordable premiums. Both the employer and the employees can avail benefits from the purchased policy. Here are a host of benefits that can be availed:

For Employees
  • Comprehensive Coverage: This policy is beneficial for employees who can’t afford to buy an individual standalone policy and so, there is an employer’s contribution involved. Organizations provide employee term life insurance to their employees as long as they are part of them.
  • Low-cost Premiums: The premiums are dependent on several factors such as age group, income, professional risk, and so on. In comparison with the regular term life insurance plans, the premium rates of employee term life insurance policies are affordable since the risk is uniformly distributed in the overall group. The premium contributions too, are shared between the employer and the employee making it an economical option over individual term policies.
  • Covers the employee’s families: The policy provides sufficient financial cover to the employee’s family by providing them with a death benefit, in case of the employee’s demise.
  • Payment Mode: In order to minimize the risk of missing a premium due date, the premiums are directly debited from the employee’s salary bank account or any other bank account designated by him. The payment can be made on an annual/semi-annual/quarterly/monthly basis.
  • Rider options: The policy allows the employee to enhance its coverage by adding rider benefits at a minimal premium. Some of the riders that can be attached with the employer term life insurance policies are critical/terminal illness rider, accidental death rider, and total permanent/partial disability riders.

For Employers
  • Helps tackle employee attrition: Employee term life insurance policies cast an impression that the employers are concerned about their employees’ health and well-being, and in turn, help them draw more new talent to their organization.
  • Boosts productivity: A group term life insurance coverage for employees ensures a stress-free work environment that can lead to an increase in the work productivity of the employees, and the company. Better productivity assures bigger profits for the company.
  • Tax benefits for employer contribution: The employer or the organization can avail tax exemption for premium contributions toward the policy under u/s 37(1) of Income Tax Act 1961 as business expenses.
Summing it Up

An employee term life insurance policy is apt for employees or organizations who wish to monetarily secure the families of their employees. Keeping in view the interest of their employees, organizations are advised to choose reliable and beneficial covers such as the Future Generali Group Term Life Insurance plan that provides affordable insurance coverage to a firm’s members/employees under a single plan. It is a valuable incentive that companies can offer to its employees given its flexible coverage options like flat, graded and salary based. The premiums towards the policy can be paid in yearly/semi-annually/quarterly/monthly terms. The plan also allows for multiple rider benefits such as critical illness benefit, accidental death benefit, and disability benefit.

A company’s future and success lie in the hands of its employees and their work performance. Offering them employee term life insurance coverage not only makes them feel important but also secure under the shade of such employers/organizations who care for them and their families.

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