Group Permanent Life Insurance: Benefits And Features Explained

Group permanent life insurance, also known as whole life insurance, is a type of life insurance that provides coverage no matter when the policyholder dies. It is often provided as an employee benefit, with the employer or organisation purchasing the policy for its staff or members. Group permanent life insurance can be broken down into three different types of offerings: group ordinary insurance, group paid-up plans, and group universal life insurance. Group ordinary insurance is any type of group life plan that uses cash value life insurance in the plan. When employees contribute to their group plan, they are normally allowed to own the cash portion of the policy. Group paid-up plans combine term life insurance (paid by the employer) and whole life (paid by the employee). Group universal life insurance provides employees with permanent life insurance protection and the potential for tax-deferred cash accumulation with a fixed rate of return.

Group ordinary insurance

Group permanent life insurance, also known as Whole Life, can be broken down into three different types of offerings. Group ordinary insurance is any type of group life plan that uses cash value life insurance in the plan. When employees contribute to their group plan, they are usually allowed to own the cash portion of the policy. However, at the employer's discretion, if an employee terminates employment, the cash value can be retained by the employer and used to help fund the plan for the remaining employees.

Group permanent life insurance is a type of permanent life insurance that features a savings component. Employees may choose to pay only the cost of insurance or to make additional contributions to a cash value account that can be accessed through loans or withdrawals. These additional dollars are allocated to a guaranteed account, which earns a minimum fixed interest rate for cash value growth. Group permanent life insurance provides flexible premium payments and reliable cash value growth tied to a fixed interest rate, offering stable growth over time.

Group life insurance is generally provided in two types of policies: group term life insurance and group universal life insurance. The former covers a specific period, while the latter is a type of permanent life insurance. The advantages of group life insurance include financial protection for loved ones after the policyholder's death, cost-effectiveness and ease of purchase. This is relatively common as nearly three-quarters of full-time employees have access to group life insurance through work. Term or universal group insurance is often an easy way to get basic coverage. Although most employees participate in some form of group coverage, it is important to determine if this type of life insurance policy meets all your needs.

Group paid-up plans

Group permanent life insurance (also known as Whole Life) can be broken down into three different types of offerings. Group ordinary insurance is any type of group life plan that uses cash value life insurance in the plan. When employees contribute to their group plan, they are normally allowed to own the cash portion of the policy. However, at the employer's discretion, if an employee terminates employment, the cash value can be retained by the employer and used to help fund the plan for the remaining employees.

Group universal life insurance

Group permanent life insurance (also known as whole life insurance) is a type of life insurance that is offered as an employee benefit. It can be broken down into three different types of offerings: group ordinary insurance, group paid-up plans, and group universal life insurance.

Group term life insurance

Employees who elect coverage through the group policy usually receive a certificate of coverage, which is needed to provide to a subsequent insurance company in the event that an individual leaves the company or organisation and terminates their coverage. Group term life insurance is a cost-effective way to get basic coverage and is relatively common, with nearly three-quarters of full-time employees having access to group life insurance through work.

Group universal life insurance (GUL) provides employees with permanent life insurance protection and the potential for tax-deferred cash accumulation with a fixed rate of return. Employees may choose to pay only the cost of insurance or to make additional contributions to a cash value account that can be accessed through loans or withdrawals. These additional dollars are allocated to a guaranteed account, which earns a minimum fixed interest rate for cash value growth. GUL provides flexible premium payments and reliable cash value growth tied to a fixed interest rate, offering stable growth over time.

Whole life insurance

Group permanent life insurance, also known as whole life insurance, is one of the three types of group plan market offerings. Group ordinary insurance is any type of group life plan that uses cash value life insurance in the plan. Employees who contribute to their group plan are normally allowed to own the cash portion of the policy. However, if an employee terminates their employment, the employer may retain the cash value to help fund the plan for the remaining employees. Group paid-up plans combine term life insurance (paid by the employer) and whole life (paid by the employee).

Group universal life insurance (GUL) is another type of permanent life insurance that features a savings component. Employees may choose to pay only the cost of insurance or to make additional contributions to a cash value account that can be accessed through loans or withdrawals. These additional dollars are allocated to a guaranteed account, which earns a minimum fixed interest rate for cash value growth. GUL provides flexible premium payments and reliable cash value growth tied to a fixed interest rate, offering stable growth over time.

Frequently asked questions