Group Universal Life Insurance
Group Universal Life InsuranceAccording to the Insurance Dictionary, Group Life Insurance is defined as "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." Group universal life insurance has several other unique characteristics. With group life insurance, policies are issued based on the risk associated with an entire group of employees, not just the risk assessment of one individual. Also, every employee who signs up for the plan must be covered, so that a group life insurance policy is a guaranteed issue policy in which no participant can be excluded even if they have a pre-existing condition (not all employees sign up for group life insurance because employers typically fund the policies with partial or total paycheck deduction). And, all employees who enroll have a guaranteed right of conversion upon termination. This means that if, for any reason, an employee who is part of a group life insurance plan leaves the company, s/he has the right to convert the policy into an individual policy if s/he exercise the right within 30 days of termination of employment. The new premium is calculated based upon the employee's Attained Age at the time, but otherwise the new personal policy is guaranteed issue. It's also typical for a group universal life insurance policy to include a disability benefit for employees under 60 in the form of a waiver of premiums (the employee would still be covered and their policy still be in force during their disability period). Group universal life insurance death benefits are usually from 1 to 2 times the amount of the employee's annual salary. However, many companies also provide special life insurance coverage in the case of accidental death that takes place on company time, such as if the employee is traveling on business. This special benefit is usually a policy rider that stipulates in such cases the death benefit is 6 times the employee's annual salary. If you work for a company that offers group universal life insurance benefits, without question sign up for them. Even if they are paid for through payroll deduction, the premiums are cheap and you can't be turned down. However--many people fool themselves into believing that since they have their group policy they need no personal life insurance coverage. This is a mistake for at least one reason: group policies simply do not provide all of the coverage a person needs. A person who would leave behind a financial burden on people if he died should have from 8 to 10 times his annual salary in death benefit, and that should be for all coverable death, not just an accidental death on company time. Also, there may be personal circumstances that warrant having yet another additional policy. For instance, if you have a mortgage you should have a term life policy that specifically covers that mortgage, too. You also cannot use group universal life insurance to build cash value. If you are interested in the tax-sheltered cash value building capabilities of something like variable universal life insurance, you will need to get that through individual means. When you are putting together a financial plan, simply base your personal life insurance needs on what group life insurance coverage you have. For instance, if you have $100,000 in group coverage and your salary is $50,000, you need a personal policy of $300,000 to $400,000. The eLifePolicy.com website offers one of the quickest and most convenient ways to purchase term life insurance coverage. Their easy 3-step process can be completed from the privacy of your home or office without speaking to an agent or requiring you take a medical exam. Just answer a few health questions. If qualified, you can print your in-force life insurance policy in minutes!Click Here
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