How to Choose the Right Group Life Insurance Plan?

5-June-2021 |

Insurance plans have become an absolute necessity considering the vulnerability of human life in today’s times. Companies willing to make smarter choices for their employees invest in policies that can take care of their workforce and their loved ones after them. A group term insurance plan is one such example. Offered by the employer, group insurance plans in India are inexpensive and very common among the leading large-scale organizations.


These plans are a hassle-free way to have insurance benefits at an affordable premium where not only the worker but also their immediate family, including spouse, children, and dependent parents, can be covered.


Group life insurance plans offer continuous safety and security against life’s most common and inevitable certainties, such as death, temporary or permanent illness, disability, accident, critical illness,or even cancer. the plans act as a shield that protects those covered under them.



Key Features of a Group Plan:



Under a group insurance policy, a business purchases a master agreement from an insurance agency. The premium is decided based on the number of individuals and the level of inclusion. If there is an increase in the number of individuals covered, the premium will grow proportionately. Similarly, premium expenses on the higher side will be returned by the insurance agency if the number of individuals covered decreases. The insurer is held accountable for the group’s wellbeing, and individuals are not required to undergo any medical tests.


Financial ease


Group insurance plans are not as costly as individual plans. This is because having many employees under one plan permits the insurer to club different costs, such as organizational, operational, and renewal, and distribute them among the individuals.


Co-partnership between employee and employer


If the policy is supported by the business, there is no monetary pressure on the employees. Both employees and employers contribute to the premium for the group life insurance plan.



What are the benefits of a Group Life Insurance Plan?




Affordability is one of the many noted benefits of group life insurance plans. Both businesses and employees, for the most part, share the premium expenses for insurance plans, making them highly reasonable for each party. As for the premium contribution, the business may choose to deduct the amount from their employees’ compensation.


Value for Money


Another attractive benefit of group insurance plans is value for money. Employees do not have to pay separately other than a premium drawn from their monthly take-home salaries. Meeting all the requirements for group plans is simple, with inclusion ensured to all group individuals. Unlike individual plans, group insurance plans in India do not need a medical test.


Wider Coverage


A group life insurance plan gives life cover assurance to many people under a single or master agreement. The insurance agency does not need to go through the dreary cycle of rounding up applications or direct medical tests for every candidate. All things considered, the business becomes the candidate and the primary policyholder, subsequently selecting the arrangement benefits and finishing the paperwork on their own.


Tax Coverage


Group plans offer tax* advantages for the employees just as much they do for the businesses. The death benefits given to representatives under the plan are exempted under Section 10(10D) of the Income Tax Act.


What are the different types of Group Insurance Plans?


Here’s how the various plans differ from each other:


1. Term Life Cover


Most group term insurance plans offer term disaster protection plans. The arrangement can be restored yearly. No proof should be given to the insurance agency to benefit from the plan. In this way, it is possible to complete the documentation without clinical trials. This basic and direct life cover plan provides advantages to businesses and employees. Employers get a tax exemption when purchasing a protection plan. If the employee contributes to the protection plan, the sum paid will be deducted from annual income taxes under segment 80C.


If you are looking for a decent term life cover Tata AIA Online offers Life Insurance Group Sampoorna Raksha (UIN: 110N154V01) plan as comprehensive package protection against death, illness, or disability. The plan is designed to benefit the applicant with the amount equivalent to their total sum assured when needed, ensuring financial security.


2. Pension or Superannuation Plan


Group life insurance plans are offered by employers to help employees build their retirement corpus. It is seen as an option different from other mainstream retirement plans like the EPF and NPS. The premium contributed towards these plans develops over a period and gives employees a huge corpus at the time of retirement.


3. Personal Accident Insurance


This resembles individual insurance plans. The only distinction is that it is offered to a group. By and large, most businesses, credit companies, and banks offer group personal accident insurance cover to their representatives and clients. The coverage offered under this arrangement compensates for the expense due to accidental injuries during work hours, prompting hospitalization, incomplete or perpetual disability, and even death.




Group term insurance plans offer greater benefits in terms of life as well as financial security. They pay the sum assured even if the policyholder is no more, the requirement being this should be before the end of the payment term. Thus, it provides greater security to the employees and their dependents. Tata AIA Online offers a host of  group life insurance plans  for different requirements to meet every need and preference.

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  • *Income Tax benefits would be available as per the prevailing income tax laws, subject to fulfilment of conditions stipulated therein. Income Tax laws are subject to change from time to time. Tata AIA Life Insurance Company Ltd. does not assume responsibility on tax implications mentioned anywhere in this document. Please consult your own tax consultant to know the tax benefits available to you

  • Insurance cover is available under the product.

  • The products are underwritten by Tata AIA Life Insurance Company Ltd.

  • The plans are not a guaranteed issuance plan and it will be subject to Company’s underwriting and acceptance.

  • For more details on risk factors, terms and conditions please read sales brochure carefully before concluding a sale.

  • This blog is for information and illustrative purposes only and does not purport to any financial or investment services and do not offer or form part of any offer or recommendation. The information is not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action.

  • Please know the associated risks and the applicable charges, from your Insurance agent or the Intermediary or policy document issued by the insurance company.

  • Every effort is made to ensure that all information contained in this blog is accurate at the date of publication, however, the Tata AIA Life shall not have any liability for any damages of any kind (including but not limited to errors and omissions) whatsoever relating to this material.