Quick Link
Muthoot Blog Banner
BLOG

Stay

Updated at

All Times

A COMPLETE GUIDE TO GROUP TERM LIFE INSURANCE PLANS IN INDIA

When you take a term life insurance policy, your dependents will receive a death benefit if something happens to you. Every person who has financial dependent(s) should have this insurance plan. Finding the best term plan for you can get really tiring and confusing. In India, many insurance companies are providing Group Term Life Insurance Plans. These policies are designed to fulfil the insurance needs of a particular group. There are certain types of groups that are eligible for a group term insurance plan like employer-employee, non-employer-employee non-banking financial institutions, microfinance institutions and specialist groups.

A group life insurance plan:

  • Covers the death of the insured

  • Does not provide a maturity value

  • Can be given to a group with at least 50 members.

Benefits:

  • Default Insurance Cover: Every member gets the insurance cover by just being a part of that particular group. Basic coverage is provided to all the members.

  • Disability Benefits: There are a few insurance schemes that provide disability benefits as well.

  • Tax Benefits: Under current tax laws, death benefits are non-taxable.

  • Customizable: Every person has different requirements. If you are covered under a group term life insurance policy, you can customize it by opting for add-ons like tuition premium, repatriation allowance etc.

  • Budget-friendly: Since a group term plan caters to the insurance needs of a group of people, it has a low premium cost. A group policy costs less than an individual insurance policy.

  • Flexibility: Group administrators can add or delete members at any point of the year.

  • Quick and Easy: The application process is easy as it does not require a lot of documentation formalities and takes no time.

  • No Medical Check-ups:  To take the insurance cover, an individual does not have to go through any kind of medical examination or submit medical reports.

  • Annual Renewal: These insurance plans can be renewed every year.

  • Additional Coverage: There are a few schemes that provide coverage for outstanding housing loans, car loans etc.

How does a group term plan work?

A group administrator pays the initial premium amount and gets the master policy. All members of the group are covered for one year in this initial premium. There are different types of group life insurance. It depends on your group administrator which one to choose. However, participants have the option of choosing the sum assured. Either it can be a one-time payment or connect to the payroll. Once a member pays the fees, he/she will be covered for a year from the start date of the plan. This policy can be renewed on an annual basis.

Other Features:

Some other amazing features of group term life insurance are:

  • Eligibility Age: Any individual who is of an age between 18 to 69 years can enrol for a group term plan.

  • Coverage: Some insurance plans offer uniform coverage to all the participants in a group while some others come with ranked covers for various grades of group members.

  • Tenure: Generally, these policies have one year of insurance coverage. After that, you can get it renewed every year.

  • Portability: If you are a part of the group insurance plan taken by your employer, your cover ends immediately when you leave that job. Certain insurance companies give an option to convert your policy to a personal term insurance policy while changing the job.

If you are a working professional, you can get a term life insurance cover as part of a group insurance plan. These plans are offered by employers to their employees in order to ensure the financial independence of their family members. The beneficiaries of insured members will receive a specific amount in the unfortunate event of their death.

Wondering which is the best term insurance plan in India 2021? At Muthoot Finance, we have multiple options for Group Term Life Insurance. If you want to know how to buy term insurance online, our team of finance experts will help you with that as well. Visit the nearest Muthoot Finance branch for more queries.

Subscribe to our newsletter

Close Icon

help us serve you better