Description
This is a PPT describes on group insurance. It compares individual insurance with group insurance and covers the further details on the group insurance.
GROUP LIFE INSURANCE
BY GROUP 10-
Indu Meenakshi Piyush Rakesh Sandeep
INTRODUCTION TO GROUP INSURANCE
Group Insurance Scheme is life insurance protection to groups of people. This scheme is ideal for employers, associations, societies etc. and allows you to enjoy group benefits at really low costs. Group insurance policies offer life insurance protection to all types of groups such as: a) Employer-employee groups b) Professionals c) Cooperatives d) Weaker sections of society, etc
INDIVIDUAL vs. GROUP INSURANCE
The main difference between group and individual/conventional insurance is that in group schemes the whole group of persons is considered as a single unit for insurance purposes like underwriting and the same “master policy” is applicable to all members of the group. The (premium payer) will receive the master policy and the members will receive a Certificate of Insurance, which summarizes the coverage terms and explains the members’ rights under the contract.
KEY FEATURES
? Low rates of payable premium that are based upon the
ages, combinations of members, occupations and working conditions. ? Simple insurability conditions such as employees not being absent from duty owing to ill health at the commencement of the policy period. ? Easy administration since a single master policy is issued to cover all the employee members.
TYPES OF COVERAGE
?
Life cover Group life insurance covers the life of each individual within the insured group. A single policy is issued for the entire group and the premium collected is from the group owner. ? Accident/Disability cover There are four types of coverage possible in insurance against accidents: a. Death by accident. b. Permanent partial disability. c. Permanent total disability d. Dismemberment. ? Medical cover a. Critical Illness b. Hospital Cash & Mediclaim ? Pension cover In this segment, the products fall in the following categories: a. Provident fund. b. Gratuity. c. Superannuation.
FREE COVER LIMIT OR NO EVIDENCE LIMIT
Group products are generally simplified and structured in such a way that no medical check up is needed for insurance until a specified amount. This amount is known as the No Evidence Limit (NEL) or Free Cover Limit (FCL) which varies from group to group based on contract terms. The limit is usually a per person figure that applies to all members in the group.
GRACE PERIOD PROVISIONS
Group life and health insurance policies typically contain a 31-day grace period provision. As in the case of an individual insurance policy, the insurance coverage provided by a group insurance policy remains in force during the grace period. If the group policyholder does not pay the premium by the end of this period, the group policy will terminate.
TERMINATION PROVISIONS
The coverage an individual insurance policy provides is effective as long as the individual insurance policy is in force; coverage terminates when the individual policy terminates. Similarly, under many types of group insurance contract, a group members’ coverage terminates when the master group policy terminates. Most group insurance policies provide that a group insured’s coverage will terminate if the group insured (1) ceases to be a member of a class of persons eligible for coverage, (2) terminates her employment or group membership Or (3) fails to make a required contribution to the premium.
STANDARD GROUP INSURANCE PRODUCTS
? Group Term Life Insurance Schemes a. Basic group term life b. Supplemental group term life c. Portable term life ? Group Savings Linked Insurance Schemes (GSLI) ? Group Credit Life Insurance and ? Group Health Insurance ? Group Dental Insurance ? Worldwide Travel Group Insurance ? Group Term Disability Insurance
a. b.
Group Short Term Disability Insurance Group Long Term Disability Insurance
DISTINCTION BETWEEN LIC AND ICICI GROUP INSURANCE SCHEMES
?Group Term Insurance Schemes
•Nature of the Scheme: Group (term) Insurance Scheme is meant to provide life insurance protection to groups of people. Administration of the scheme is on group basis and cost is low. •Under Group (Term) Insurance Scheme, life insurance cover is allowed to all the members of a group subject to some simple insurability conditions without insisting upon any medical evidence.
• One master policy covers all the proposed employees in your groupwhich should comprise a minimum of 25 members. New members can join the group and current members can leave at any time during the policy term. • Cover can be extended to all employees between 18 and 70 years of age. • Cover is calculated uniformly, or based on designation or rank, or as a multiple of salary, or against outstanding loan amount.
? Scheme offers covers only on
death and there is no maturity value at the end of the term. ? Premium Chargeable: Group (Term) Insurance Scheme is at present offered under One Year Renewable Group term assurance plan (OYRGTA). ? Every year on Annual Renewal date LIC charges the premium depending upon the changes in size and age distribution of the age group.
? Premiums you pay are treated as a ?
?
?
?
business expense in the year of payment. Employees enjoy greater convenience with relaxed underwriting and medical requirements. 'Free Cover Limits' with simplified underwriting depending on the number of employees in your group and the level of cover you choose. Employees are additionally covered with an Accident and Disability Benefit Rider and Critical Illness cover. Group members' nominees receive the entire benefit should something happen to your member.
?Group Term in lieu of EDLI Scheme
? The premium payable by the
? Premiums you pay are usually
employer is usually less than the total contribution being paid by the employer to R.P.F.C; particularly when the salary level is high and average age of the group is low. ? Premium paid by the employer is treated as normal business expenses for Income-Tax purpose. ? Settlement of claim is quicker, LIC requires only the death certificate and the Claim Form from the employer.
less than the total contribution you pay to R.P.F.C-particularly when your team comprises young employees who earn high salaries. ? Premiums you pay are treated as normal business expenses under sec 37 of IT Act, 1962 for Income Tax purposes. ? Your claims are settled quickly, without you needing to go through several cumbersome procedures.
? Each employee is covered for
? Each employee is covered
a sum assured ranging between 5,000 to 2,00,000 depending upon the current salary and service put in from day one irrespective of the actual balance in the Provident Fund. Alternatively every employee/ worker can be covered for a uniform sum assured which will be decided depending upon the group size. ? Double accident benefit can be allowed to the extent of the Sum Assured for an extra Premium.
for a Sum Assured between Rs. 65,000 and Rs. 1 lakh depending on their current salary and service put in from the day they join, irrespective of the actual balance in the Provident Fund. Alternatively every employee/worker can be covered for a uniform sum assured of Rs.65,000. ? Claim amounts are exempt from taxes under Sec. 10 (10) (d) of IT Act, 1962.
?Group Gratuity Plan
The gratuity arrangement with LIC provides the following services to the company Fund management under interest accumulation system Claim settlement on exit as per company rules/gratuity act Built in Insurance arrangement for the employees for future service MIS related to Income Tax and trusts accounts and Actuarial valuation
? Multiple investment options
?
?
?
?
with market-linked plans : Choose between short-term debt, debt, balanced, and growth funds depending on your financial objectives. ? Portfolio transparency : Manage your funds more efficiently with daily disclosures of Unit Value and regular disclosures of each fund's portfolio. ? Switch benefit : Switch between funds at any time to adjust your portfolio depending on your goals and risk profiles.
? Insurance cover for future service
? Life insurance : Safeguard your
gratuity: Another salient feature of the Gratuity Scheme with LIC is that it provides for insurance coverage to the employees to the tune of future service gratuity subject to certain limits. The insurance cover can be flexible depending on the requirements of the Trust. The Group Insurance premium will be commensurate to the cover provided.
? Income Tax Benefit on Insurance
?
?
?
Premium The insurance premium paid towards the above said benefits is treated as deductible business expenses to the company.
?
employee's wellbeing with a bundled life insurance cover that requires minimal amount of underwriting. Actuarial services : Make a scientific estimation of your gratuity liability. Low explicit charge structure with conditions for exit specified upfront. Faster claim settlement, easier access to information and regular statements. End-to-end solution in the legal and regulatory approval process for scheme set up or transfers.
?Group Leave Encashment Plan
? Nature of liability: ? Multiple Investment Options :
The amount depends upon the leave to the credit of the employee and his/ her salary at the time of exit. Liability is of increasing nature as it is linked with salary as well as leave position. ? On the exit of an employee or encashment of leaves during the service the Leave Encashment amount will be paid from the Fund of the scheme maintained with LIC.
Choice to invest across multiple fund options to give you a flexible investment pattern. ? Switching Option : While you have chosen a fund option, you have the flexibility of switching between our various funds at any time. Switching between the various funds is allowed depending upon your requirements. We offer unlimited free switches; however, the minimum value of such switch has to be Rs. 10,000.
? On the death of an employee, in
? Premium Redirection : The
addition to his / her leave encashment benefit, his/her family will be entitled to the amount of Insurance Cover, which will be tax-free. ? The Life Insurance Corporation of India will do the Actuarial Valuation and will provide necessary certificate as per AS15. ? The amount of Term Insurance Premium paid for Life Insurance Cover will be treated as business expenses.
annual contributions can be redirected for investments into a fund of your choice and need not adhere to the original investment pattern. ? Life insurance cover : (subject to a minimum of Rs. 1000/- per employee) thus, promising protection on the life of your employee at nominal cost.
doc_668754670.ppt
This is a PPT describes on group insurance. It compares individual insurance with group insurance and covers the further details on the group insurance.
GROUP LIFE INSURANCE
BY GROUP 10-
Indu Meenakshi Piyush Rakesh Sandeep
INTRODUCTION TO GROUP INSURANCE
Group Insurance Scheme is life insurance protection to groups of people. This scheme is ideal for employers, associations, societies etc. and allows you to enjoy group benefits at really low costs. Group insurance policies offer life insurance protection to all types of groups such as: a) Employer-employee groups b) Professionals c) Cooperatives d) Weaker sections of society, etc
INDIVIDUAL vs. GROUP INSURANCE
The main difference between group and individual/conventional insurance is that in group schemes the whole group of persons is considered as a single unit for insurance purposes like underwriting and the same “master policy” is applicable to all members of the group. The (premium payer) will receive the master policy and the members will receive a Certificate of Insurance, which summarizes the coverage terms and explains the members’ rights under the contract.
KEY FEATURES
? Low rates of payable premium that are based upon the
ages, combinations of members, occupations and working conditions. ? Simple insurability conditions such as employees not being absent from duty owing to ill health at the commencement of the policy period. ? Easy administration since a single master policy is issued to cover all the employee members.
TYPES OF COVERAGE
?
Life cover Group life insurance covers the life of each individual within the insured group. A single policy is issued for the entire group and the premium collected is from the group owner. ? Accident/Disability cover There are four types of coverage possible in insurance against accidents: a. Death by accident. b. Permanent partial disability. c. Permanent total disability d. Dismemberment. ? Medical cover a. Critical Illness b. Hospital Cash & Mediclaim ? Pension cover In this segment, the products fall in the following categories: a. Provident fund. b. Gratuity. c. Superannuation.
FREE COVER LIMIT OR NO EVIDENCE LIMIT
Group products are generally simplified and structured in such a way that no medical check up is needed for insurance until a specified amount. This amount is known as the No Evidence Limit (NEL) or Free Cover Limit (FCL) which varies from group to group based on contract terms. The limit is usually a per person figure that applies to all members in the group.
GRACE PERIOD PROVISIONS
Group life and health insurance policies typically contain a 31-day grace period provision. As in the case of an individual insurance policy, the insurance coverage provided by a group insurance policy remains in force during the grace period. If the group policyholder does not pay the premium by the end of this period, the group policy will terminate.
TERMINATION PROVISIONS
The coverage an individual insurance policy provides is effective as long as the individual insurance policy is in force; coverage terminates when the individual policy terminates. Similarly, under many types of group insurance contract, a group members’ coverage terminates when the master group policy terminates. Most group insurance policies provide that a group insured’s coverage will terminate if the group insured (1) ceases to be a member of a class of persons eligible for coverage, (2) terminates her employment or group membership Or (3) fails to make a required contribution to the premium.
STANDARD GROUP INSURANCE PRODUCTS
? Group Term Life Insurance Schemes a. Basic group term life b. Supplemental group term life c. Portable term life ? Group Savings Linked Insurance Schemes (GSLI) ? Group Credit Life Insurance and ? Group Health Insurance ? Group Dental Insurance ? Worldwide Travel Group Insurance ? Group Term Disability Insurance
a. b.
Group Short Term Disability Insurance Group Long Term Disability Insurance
DISTINCTION BETWEEN LIC AND ICICI GROUP INSURANCE SCHEMES
?Group Term Insurance Schemes
•Nature of the Scheme: Group (term) Insurance Scheme is meant to provide life insurance protection to groups of people. Administration of the scheme is on group basis and cost is low. •Under Group (Term) Insurance Scheme, life insurance cover is allowed to all the members of a group subject to some simple insurability conditions without insisting upon any medical evidence.
• One master policy covers all the proposed employees in your groupwhich should comprise a minimum of 25 members. New members can join the group and current members can leave at any time during the policy term. • Cover can be extended to all employees between 18 and 70 years of age. • Cover is calculated uniformly, or based on designation or rank, or as a multiple of salary, or against outstanding loan amount.
? Scheme offers covers only on
death and there is no maturity value at the end of the term. ? Premium Chargeable: Group (Term) Insurance Scheme is at present offered under One Year Renewable Group term assurance plan (OYRGTA). ? Every year on Annual Renewal date LIC charges the premium depending upon the changes in size and age distribution of the age group.
? Premiums you pay are treated as a ?
?
?
?
business expense in the year of payment. Employees enjoy greater convenience with relaxed underwriting and medical requirements. 'Free Cover Limits' with simplified underwriting depending on the number of employees in your group and the level of cover you choose. Employees are additionally covered with an Accident and Disability Benefit Rider and Critical Illness cover. Group members' nominees receive the entire benefit should something happen to your member.
?Group Term in lieu of EDLI Scheme
? The premium payable by the
? Premiums you pay are usually
employer is usually less than the total contribution being paid by the employer to R.P.F.C; particularly when the salary level is high and average age of the group is low. ? Premium paid by the employer is treated as normal business expenses for Income-Tax purpose. ? Settlement of claim is quicker, LIC requires only the death certificate and the Claim Form from the employer.
less than the total contribution you pay to R.P.F.C-particularly when your team comprises young employees who earn high salaries. ? Premiums you pay are treated as normal business expenses under sec 37 of IT Act, 1962 for Income Tax purposes. ? Your claims are settled quickly, without you needing to go through several cumbersome procedures.
? Each employee is covered for
? Each employee is covered
a sum assured ranging between 5,000 to 2,00,000 depending upon the current salary and service put in from day one irrespective of the actual balance in the Provident Fund. Alternatively every employee/ worker can be covered for a uniform sum assured which will be decided depending upon the group size. ? Double accident benefit can be allowed to the extent of the Sum Assured for an extra Premium.
for a Sum Assured between Rs. 65,000 and Rs. 1 lakh depending on their current salary and service put in from the day they join, irrespective of the actual balance in the Provident Fund. Alternatively every employee/worker can be covered for a uniform sum assured of Rs.65,000. ? Claim amounts are exempt from taxes under Sec. 10 (10) (d) of IT Act, 1962.
?Group Gratuity Plan
The gratuity arrangement with LIC provides the following services to the company Fund management under interest accumulation system Claim settlement on exit as per company rules/gratuity act Built in Insurance arrangement for the employees for future service MIS related to Income Tax and trusts accounts and Actuarial valuation
? Multiple investment options
?
?
?
?
with market-linked plans : Choose between short-term debt, debt, balanced, and growth funds depending on your financial objectives. ? Portfolio transparency : Manage your funds more efficiently with daily disclosures of Unit Value and regular disclosures of each fund's portfolio. ? Switch benefit : Switch between funds at any time to adjust your portfolio depending on your goals and risk profiles.
? Insurance cover for future service
? Life insurance : Safeguard your
gratuity: Another salient feature of the Gratuity Scheme with LIC is that it provides for insurance coverage to the employees to the tune of future service gratuity subject to certain limits. The insurance cover can be flexible depending on the requirements of the Trust. The Group Insurance premium will be commensurate to the cover provided.
? Income Tax Benefit on Insurance
?
?
?
Premium The insurance premium paid towards the above said benefits is treated as deductible business expenses to the company.
?
employee's wellbeing with a bundled life insurance cover that requires minimal amount of underwriting. Actuarial services : Make a scientific estimation of your gratuity liability. Low explicit charge structure with conditions for exit specified upfront. Faster claim settlement, easier access to information and regular statements. End-to-end solution in the legal and regulatory approval process for scheme set up or transfers.
?Group Leave Encashment Plan
? Nature of liability: ? Multiple Investment Options :
The amount depends upon the leave to the credit of the employee and his/ her salary at the time of exit. Liability is of increasing nature as it is linked with salary as well as leave position. ? On the exit of an employee or encashment of leaves during the service the Leave Encashment amount will be paid from the Fund of the scheme maintained with LIC.
Choice to invest across multiple fund options to give you a flexible investment pattern. ? Switching Option : While you have chosen a fund option, you have the flexibility of switching between our various funds at any time. Switching between the various funds is allowed depending upon your requirements. We offer unlimited free switches; however, the minimum value of such switch has to be Rs. 10,000.
? On the death of an employee, in
? Premium Redirection : The
addition to his / her leave encashment benefit, his/her family will be entitled to the amount of Insurance Cover, which will be tax-free. ? The Life Insurance Corporation of India will do the Actuarial Valuation and will provide necessary certificate as per AS15. ? The amount of Term Insurance Premium paid for Life Insurance Cover will be treated as business expenses.
annual contributions can be redirected for investments into a fund of your choice and need not adhere to the original investment pattern. ? Life insurance cover : (subject to a minimum of Rs. 1000/- per employee) thus, promising protection on the life of your employee at nominal cost.
doc_668754670.ppt