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Group Term Life Insurance Policy
What is the most important asset of an organisation?
Without an iota of doubt, it's the employees, the people who invest their life in the growth of an organisation.
As a responsible organization that values its employees, it's important to provide them with comprehensive financial security. One way to demonstrate this commitment is through the provision of group term life insurance in India.
A Group Term Insurance serves as a vital component of a responsible organization's efforts to safeguard its workforce. It offers employees and their families a crucial layer of financial protection, ensuring that their loved ones are taken care of in the event of an unfortunate loss.
Digit Life Group Term Insurance provides you a hyper customizable and flexible protection solution that you can provide to your employees.
What is a Group Term Life Insurance?
A Group Term Insurance is a type of insurance plan wherein a single policy covers a group of individuals. It is usually taken by employers providing life coverage to their employees wherein the Sum Assured is paid to the nominee in case of unfortunate demise of the employee during the policy term.
In the case of Group Term Insurance, the employer is the policyholder, and the employee is the Life Assured. In the unfortunate event of the employee's demise, who is the Life Assured in this case, the Group Term Insurance becomes the mode of financial security for the employee's family.
Digit Life Group Term Insurance is a non-linked, non-participating, group pure risk premium insurance plan that provides life insurance cover to insured members and in case of unfortunate event, financially protect their families. A highly customisable and flexible insurance solution that offers a tailormade solution for both the employer and the employee.
What's Great About a Group Term Life Insurance by Digit Life?
1. Hyper Customizable
- Get Inbuilt Optional Benefits like Accidental Death Benefits, Terminal Illness Benefit, Critical Illness Benefit and more.
- Add-on Benefits like Spouse Cover that provides coverage to the spouse of the member, or Voluntary Insurance Coverage that provides financial support for various expenses like funeral, credit card outstanding or child education.
- Provides different options for Death Benefit Payout: Lumpsum or Regular Income. The regular income option further provides 3 choices to receive the death benefit. It can be paid up to the retirement age of the insured, up to a certain age of the child or a certain selected time.
2. Tech Enabled, Smooth Processes
- Minimal, and online documentation makes our processes hassle free.
- 72 hrs claim settlement with our super smooth processes.
- Worldwide coverage if your group company is based in India.
- No Medical Check Up needed in 99% cases.
- No Active at Work Clause for Renewals.
3. Aligned with Your Business
- By choosing the regular pay option, you can secure a premium lock for up to 3 years, providing stability and predictability in your financial planning.
- In case of favourable claims or long-term contracts, a part of the premium is refunded to the master policyholder, fostering a sense of partnership and profit sharing.
- Flexibility to choose your premium payment frequency, whether it's annual, half-yearly, quarterly, or monthly, enabling you to manage your cash flow efficiently.
How Does a Group Term Life Insurance Plan Work?
Group Formation
The Group Term Life Plan can be offered to Employer-Employee, Non-Employer-Employee or Affinity groups. The representative identifies a group comprising eligible members who will be covered under the Group Term Life Insurance plan. The group can be based on various factors such as department, level, or the entire workforce.
At Digit, our Corporate Portal for Group Term Insurance makes group management super simple. Any changes like addition or deletion of group members during the policy year can be done easily by the corporate themselves.
Master Policy
The employer, acting as the policyholder, purchases a Master Policy from the insurance company. The Master Policy outlines the terms and conditions of the coverage, including the sum assured, premium payment details, and eligibility criteria.Premium Payment
The employer pays the premium for the entire group. In some cases, employees may contribute a portion of the premium through salary deductions. The premium amount is calculated based on factors such as the age, gender, and coverage amount of the group members.
With Digit, you can also pay your premium as per your preference - Single, Monthly, Quarterly, Half Yearly or Annually.
Coverage and Sum Assured
Each employee covered under the Group Term Life Insurance plan is assigned a sum assured, which represents the amount that will be paid to the employee's designated beneficiary in the event of their death. The sum assured can be a fixed amount or a multiple of the employee's salary.
No Medical check-up required up to the free cover limit with Digit’s Group Term Life Plan.
Renewal
Group Term Life Insurance policies typically have a tenure of one year and need to be renewed annually. During the renewal process, the insurance company may adjust the premium rates based on factors such as the age distribution and size of the group.
Digit’s Group Term Life Plan provides you the option of Single Pay, One Year Renewable Term and Regular Pay Options. Not just that, if you choose a Regular Premium Pay Option, you can lock your premium for up to 3 years with our Premium Rate Guarantee feature!
Death Benefit
In the unfortunate event of an employee's death during the policy term, the insurance company pays the sum assured to the nominee or beneficiary designated by the employee. This benefit provides financial security to the employee's family and helps them cope with the loss.
With Digit, the insured members can choose from our different options of death benefit payout - Lumpsum or Regular Pay, as per their preference.
Portability and Continuity
Group Term Life Insurance coverage is tied to the employee's association with the employer. When an employee leaves the company, their coverage under the group policy generally ceases. However, some insurance companies offer the option of porting the coverage to an individual policy, allowing employees to continue their life insurance protection independently.
Group Term Life Insurance plans offer a cost-effective way for employers to provide life coverage to their employees. By pooling the risk of the group, it ensures that employees and their families receive financial protection in the event of an unforeseen tragedy.
Digit’s Group Term Insurance provides you a high degree of customisation and flexibility to create a tailor-made solution for your group. Members get the choice to opt from various options under the policy with respect to the applicable benefits, coverage, sum assured and other optional benefits.
Features of Group Term Life Insurance Plans
1. Tenure
Group Term Life Insurance policies typically have a tenure of one year, requiring annual renewal. This allows flexibility for the employer to reassess and adjust the coverage based on the changing needs of the group.2. Premium
The premium for Group Term Life Insurance is usually paid directly by the employer. However, in some cases, employees may contribute towards the premium through salary deductions. The premium amount can be the same for all employees, or it may vary based on the individual Sum Assured chosen for each employee.3. Death Benefit
In the unfortunate event of the policyholder's death during the policy term, the Sum Assured is paid to the nominee or beneficiary of the deceased employee. Group Term Life Insurance focuses primarily on providing a death benefit to ensure financial support for the employee's family in times of need. There are no maturity or savings components associated with this type of policy.4. Coverage
The coverage under Group Term Life Insurance is determined based on factors such as the employee's position, rank, or their Cost to Company (CTC) within the organization. The coverage amount is usually a multiple of the employee's annual salary, providing a level of financial protection to the employee's dependents.5. Contributory and Non-Contributory
Group Term Life Insurance plans can be categorized as contributory or non-contributory. In contributory plans, employees are required to contribute a specific portion of the premium, while the employer pays the remaining balance. On the other hand, non-contributory plans are fully sponsored by the employer, with no contribution required from the employees.6. Master Contract
A Group Term Insurance Policy is a master contract obtained by the organization, and it is automatically extended to all eligible employees. This means that once an employee joins the organization, they are included in the group policy by default, providing them with immediate coverage without the need for individual underwriting.7. Hassle-Free
Group Term Life Insurance policies offer a hassle-free administration process for employers. Since it is a master contract, the employer can easily add or remove members from the policy as employees join or leave the organization. This streamlines the management of the policy, reducing administrative burdens and ensuring efficient coverage for all eligible employees.Benefits of Group Term Life Insurance Policy to the Employers
1. Employee Retention
The Group Term Life Insurance Plan provides financial security to the employees and their families. This is an excellent perk to add to employees' sentiments and make them feel valued. Hence, adding to the retention effort.2. Affordable
Group Term plans are much more affordable than individual plans. They provide high coverage at a low cost.3. Tax Benefits
Employers can earn Tax Benefits on the premium paid towards Group Term Insurance under Section 37(1) of the Income Tax Act.4. Gratuity saving
If the policy provides this feature, Group Term Life Insurance plans help the employers fund their future gratuity liability for the employees.Benefits of Group Term Life Insurance Policy to the Employees
1. Insurance Cover
Group Term Life Insurance covers all members of a defined group. Hence, any new employee becomes a part of the insurance coverage by joining the company, regardless of any existing insurance coverage that they might have. This provides financial security to the employee's beneficiary.2. No Medical Check-Ups
There is no hassle of medical check-ups under Group Insurance policy upto free cover limit, as opposed to taking an individual policy where health check-ups are needed, and policy issuance is dependent on the same.3. Tax Exemption
The death benefit is exempt from tax under section 10 (10) D of the Income Tax. Also, any additional premium paid by the employee is exempt under Section 80(C).4. Customisable to Suit the Employees
Key Benefits of Group Term Life Insurance by Digit Life
| Coverage for Spouse | Available as an Add-On |
| Premium Payment Options | Single Pay, Regular, One Year Renewable |
| Inbuilt Critical Illness Benefit | Yes, Optional |
| Inbuilt Accidental Death Benefit | Yes, Optional |
| Inbuilt Terminal Illness Benefit | Yes, Optional |
| Death Benefit Payout Options | Lump Sum or Regular Income Based on Various Factors |
| Renewal Rate Guarantee | Available as an Add-On |
The Super Smooth Claims Process at Digit Life
- With our hassle-free claims process, its just 72-hour claim settlement from Last Document Received (LDR).
- We Promise a 100% paperless claims experience. No hard copies of Death Certificate or Medical Reports asked.
- Call on our 24 x 7 Helpline.
- Write to us on Lifeclaims@godigit.com.
FAQs on Group Term Life Insurance
Are Riders Available with the Group Term Life Insurance Plans?
Do I Get a Maturity Benefit or Survival Benefit Under Group Term Life Insurance?
What is the Minimum Age to Enrol for a Group Term Life Insurance Policy?
What is the Maximum Age to Enter a Group Term Life Insurance Policy?
Can I Continue With my Group Term Life Insurance Even When I Leave My Current Employer?
Can I take Loan Against this Policy?
* 1. The applicability of the wellness benefit program and its features may be amended from time to time as per the prevailing underwriting policy of Go Digit Life Insurance Limited. The list of benefits under this program and terms and conditions applicable to it are provided in Annexure I in the Product Brochure.
2. Wellness benefit is a feature of Digit Life Group Micro Term Insurance. These features are provided under the Wellness benefit program. Wellness services are extended through 3rd party Service
Providers. The cost of availing services shall be borne by the insured directly. Digit Life Insurance is not responsible in any manner for nature or quality of product/services or discounts provided by the empaneled Service Providers. You can refer to the respective Service Provider’s terms and Conditions before availing any services. The offerings of the Service Providers, including any discounts or complimentary access / service are subject to change from time to time. For more details, please read policy terms and conditions carefully before concluding the sale.
Disclaimer
- This is an informative article provided on 'as is' basis for awareness purpose only and not intended as a professional advice. The content of the article is derived from various open sources across the Internet. Digit Life Insurance is not promoting or recommending any aspect in the article or its correctness. Please verify the information and your requirement before taking any decisions.
- All the figures reflected in the article are for illustrative purposes. The premium for Coverage that one buys depends on various factors including customer requirements, eligibility, age, demography, insurance provider, product, coverage amount, term and other factors
- Tax Benefits, if applicable depend on the Tax Regime opted by the individual and the applicable tax provision. Please consult your Tax consultant before making any decision.