Group Term Life Insurance (GTL) is a type of life insurance coverage provided to a group of people, typically employees of a company, members of an organization, or other collective groups. It offers life insurance benefits at a lower cost compared to individual life insurance policies, as the premium is typically paid by the employer or the group itself. GTL provides financial protection to the beneficiaries of the policyholder in case of their untimely demise.
Features of Group Term Life Insurance (GTL)
Benefits of Group Term Life Insurance (GTL)
Who is Eligible for Group Term Life Insurance?
Eligibility typically depends on being part of the group offering the insurance (e.g., a company or association) and meeting certain employment or membership criteria set by the organization or insurer.
Frequently Asked Questions (FAQs)
The coverage amount varies, but it is often based on the employee's salary or a fixed multiple of their earnings. Some plans may offer flat amounts of coverage for all participants.
Many GTL policies offer a conversion option, allowing you to convert the group policy into an individual term life insurance policy when you leave the organization. However, premiums may be higher.
No, GTL is typically a term life insurance policy, meaning it only provides coverage for a limited period (usually the duration of employment or membership).
Most GTL policies do not require a medical exam, as they are offered to a group, which spreads the risk. However, some organizations may have specific eligibility requirements.
The death benefit from a GTL policy is typically tax-free to the beneficiary. However, if the premiums are paid by the employee, it may be subject to income tax depending on the coverage amount and the tax laws in your country.
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