Employee satisfaction contributes to the productive working atmosphere required for a successful organization. One way to motivate your employees is by ensuring financial security through group insurance. Depending on the sector, organizations provide group insurance policies to eligible employees.
The insurance plan offers multiple benefits to employees, including life cover regardless of gender, age, profession or other factors. Here is a brief description of a group insurance policy.
What is Group Life Insurance?
Group insurance is a single insurance plan that protects all members of an organization. For example, a group may comprise colleagues or employees from a similar employment sector, such as attorneys, engineers, physicians, or members of credit societies or cooperative banks.
Companies regularly provide their employees with group insurance as part of the payment benefits. The plan can be classified as follows:
- Contributory Scheme
In this case, both the employees and the company contribute to and pay a premium for a single insurance policy.
- Non-Contributory Scheme
The entire premium is paid by either the nodal agency or the employer. The nodal agency is a direct competent office in charge of consultation or implementation of government-initiated projects.
Things to Consider When Buying Group Insurance
The following are some crucial factors to consider when purchasing group insurance.
- Understand the requirements
Before purchasing group insurance, it is critical to understand the necessities of your employees, who will be the eventual beneficiaries of the coverage. What form of insurance is best suited to the organization while being cost-effective? The premium cost is proportionate to the number of new employees added to the group. Additionally, the insurance premium per person rises with time. As a result, it is essential to solicit employee feedback on the advantages provided by the scheme and if it is genuinely making a difference.
- Policy coverage
The sum assured granted by the insurance company to each employee under the group insurance policy is referred to as coverage. Depending on the organization's size and age category, you may need to add specific riders to extend the coverage. For example, if your employees are young and travel frequently, you may request accidental death or disability benefits insurance to protect them. Employees above the age of 55 may require critical illness insurance. Depending on the age of your employees, you may choose to expand or reduce coverage.
- Claim settlement ratio
The insurer's claim settlement ratio is an important feature to consider when purchasing group insurance. An insurance firm with a settlement claim ratio of more than 90 is deemed trustworthy and competent. Check to see if the claim settlement procedure is simple and quick so that your employees enjoy a stress-free experience during challenging times.
- The fine print of the plan
Every type of group insurance has its own set of inclusions and exclusions. Additionally, policy exemptions for specific situations are not covered by the plan. As a result, it is vital to read the policy's fine print before buying to ensure there are no surprises when filing the claim.
Group insurance is a practical and cost-effective solution to cover your company's employees under one plan. It allows workers to live stress-free lives, increasing their productivity, while businesses gain from tax savings and increased staff retention.
