Group Life Insurance
Basic employee benefit under which an employer buys a master policy and issues certificates to employees denoting participation in the plan. Group life is also available through unions and associations. It is usually issued as yearly renewable term insurance, although some plans provide permanent insurance. Employers may pay all the cost or share it with employees. Characteristics include:
- Group Underwriting an entire group of employees is underwritten, unlike individual life insurance where under only the individual is underwritten.
- Guaranteed Issue every employee must be accepted; an employee cannot be denied coverage because of a pre-existing illness, sickness, or injury.
- Conversion at Termination of Employment regardless of whether termination is because of severance, disability, or retirement, the employee has the automatic right to convert to an individual life policy without evidence of insurability or taking a physical examination. Conversion must be within 30 days of termination. The premium upon conversion is based on the employee's age at the time (ATTAINED AGE).
- DISABILITY BENEFIT available in many policies to an employee less than 60 years of age who can no longer work because of the disability. The benefit takes the form of waiver of premium, and the employee is covered for as long as the disability continues. The beneficiary will receive the death benefit even though the employee may not have been in the service of the employer for a long time.
- DEATH BENEFIT Structure or Schedule is usually based on an employee's earnings. The benefit is a multiple of the employee's earnings, normally 1 to 2 1/2 times the employee's yearly earnings.
Popular Insurance Terms
Payments awarded by a court in a liability suit. Money damages can be broken down into compensatory and punitive. Compensatory damages reimburse a plaintiff for expenses incurred for such ...
Endorsements to life insurance policies that provide additional benefits or limit an insurance company's liability for payment of benefits under certain conditions. These include: Waiver of ...
1965 federal law that provides for medical assistance to those who cannot afford to pay for it. Four categories of the needy can qualify: aged, blind, disabled, and families with dependent ...
Provision found in current assumption whole life insurance policies under which the insurance company retains the contractual right to recalculate the premium (after a minimum period of ...
Legislation to eliminate most tax shelters and write-offs in exchange for lower rates for both corporation and individuals. It was intended to be revenue neutral; that is, to bring in the ...
Size of the losses used as a factor in calculating premium rates. For example, the U.S. Bureau of Labor Statistics studies the number of days lost by injured employees per million ...
Legal power of the commissioner of Internal Revenue to approve any classification of employees that does not discriminate in favor of a prohibited group. Such approval is necessary before a ...
expenses and damages incurred as the result of damage to a ship and its cargo, and/or of taking direct action to prevent initial or further damage to the ship and its cargo. These expenses ...
Trust instrument that permits the owner of a residence (grantor) to transfer ownership of that residence with the grantor still being allowed to stay in that residence for a stipulated ...
Have a question or comment?
We're here to help.