The above is a famous saying that reiterates the importance of a happy workplace. So, what makes a workplace happy for the employees? Well, a satisfying pay scale with enhanced perks and allowances will be a priority. In addition, the employer's efforts to secure the employees' families will turn out to be a big boost.
 

Therefore, organisations invest in various financial products and schemes to find the best support for families in need. In this regard, employee life insurance or a group life insurance plan is a priority! So, here is a detail about seven important reasons why organisations opt for the group term plan.
 

Before we get ahead with the discussion, let us understand what group life insurance is!
 

What Is A Group Life Insurance Plan?
 

A group term plan is an insurance product that offers life cover to the members of a large group. The employer will purchase the group term insurance and pay the premium entirely or the major proportion of it regularly for the benefit of the employees. Therefore, the employer is the Master Policyholder who holds the primary policy document. However, in case of the unexpected demise of an employee, the employee's family members will get the death benefit.
 

Group life insurance plans in India offer a number of benefits for both employees and employers. Some of the key benefits include:
 

Affordable premiums: The premiums of group life insurance plans are usually less expensive than individual policies, as the cost is shared among a large number of individuals. This makes it a cost-effective option for employees who may not be able to afford individual policies.
 

Convenience: Group life insurance plans are easy to enroll in and require minimal paperwork, making it a convenient option for employees who may not have the time or resources to purchase an individual policy.
 

Automatic coverage: Employees are automatically enrolled in the group life insurance plan when they start working for the company, which eliminates the need to complete an application or medical exam.

Portable coverage: If an employee leaves the company, they can often take their coverage with them, which provides valuable protection throughout their working years.

Employee benefits: Offering group life insurance as an employee benefit can help attract and retain talented employees, as well as improve morale and job satisfaction.
 

Since group life insurance plans can vary in terms of features and benefits, always carefully review the policy details, and understand the coverage provided before enrolling in a group life insurance plan.
 

The choice between an individual life insurance plan and a group life insurance plan in India depends on your specific needs and circumstances. Both options have their own benefits and drawbacks, and the best choice for you will depend on a variety of factors.
 

Individual life insurance plans offer more level of flexibility and customization, as you can choose the coverage amount, policy term, and riders^# that best meet your needs. You can also tailor the policy to fit your budget by adjusting the premium payment amount and frequency.
 

On the other hand, group life insurance plans are typically less expensive and more convenient, as they do not require a medical exam and have minimal enrollment paperwork. Additionally, they offer automatic coverage, which eliminates the need to purchase a separate policy.
 

Why Do Organisations Prefer Group Insurance Plans In India?

 

Organisations prefer group insurance plans for various monetary and non-monetary reasons. So let us get ahead and try to understand them better:
 

1. Creating value - The primary business perspective of any organisation is to create value. Creating value in a business means providing a valuable product or service to the customer base. To ensure value creation is achieved, the employer and the employees have to work in coordination. And, to attain the right extent of coordination, employee satisfaction is a must.

    

   Employee life cover through a group insurance policy can help employees understand the efforts taken by the employer to secure their family. It will be one of the best ways to ensure employee satisfaction to create value for the business. 
    

2. Reduce the employee attrition level - Increased employee attrition levels are a common concern for many employers. Employers spend a lot of money providing the right training standards for increasing their quality of work. It will enhance the profit levels of the organisation in the long term.

    

   However, if the employee tries to look for other job opportunities, then the money invested in the employee will turn out to be a loss. Therefore, retaining maximum employees by providing varied benefits is key here. With a group life insurance plan, organisations ensure employees get life cover at a lesser cost while ensuring their family's financial future is at its best.
    

3. Cost-effective - As the employee insurance policy is designed to include many people, the risk factor is also distributed to a large extent. Therefore, the premium cost is extremely reasonable opposed to providing individual life insurance coverage to the employees.

    

4. Tax^* benefits - Group term life insurance is considered as an employee benefit cost to the organisation. Therefore, when the employer incurs the cost as an expense, it qualifies for tax^* benefits under Section 37 of The Income Tax Act, 1961. It is considered an expense when the employer pays the premium completely and does not charge the employee.

    

5. Meet statutory obligations - If an organisation is registered under the Employees Provident Fund and Miscellaneous Provisions Act, 1952, it should have the EDLI Scheme as a part of its company policy.
   
   

   EDLI is referred to as the Employees Deposit Linked Insurance. It is an insurance coverage introduced by the Employees Provident Fund Organisation(EPFO) for the employees belonging to private sector companies. The employer will have to subscribe to the policy and provide insurance benefits to the employees.
    

6. Ease of process - The application is considered a single master policy involving every member and not considered individual policies for every employee present in the organisation. Therefore, availing group life insurance and further submitting a claim for settlement in case of an unexpected demise is certainly simple. Also, there are lesser restrictions overall, and the request is handled very swiftly. Employers also don't have to maintain individual insurance plans for the employees.
   

   
   With the advancement in technology, insurance providers ensure seamless processing online. For instance, Tata AIA Life Insurance provides a simple and faster claim processing platform that is accessible 24 hours a day, 7 days a week and from anywhere in the world.
    

7. Customisable solutions - Employers can provide group life insurance benefits to employees by customising the plan based on certain parameters such as their position in the organisation, age, marital status, and salary slab. It will help the employer provide the necessary financial assistance based on their individual needs. Employers can also avail of the options to build funds for their gratuity liability necessary to pay their employees in the future.

    

Conclusion

Human resources are the most valuable asset for an organisation. The best human resource can increase profits for the organisations in a cost-effective manner for the employers. To create the best human resource, ensuring employee satisfaction and creating value is important. Therefore, organisations work towards empowering the employees to create a strong relationship by securing their families. And, group life insurance is a key to making such bonds worthwhile.
 

It can also help organisations retain their employees, enjoy tax^* benefits, and work on easily customisable solutions. So, organisations prefer opting for group life insurance for wholesome benefits in varied dimensions!
 

L&C/Advt/2023/Feb/0542