Financial - Life

Group Personal Life Insurance

Need
Grouped individual life insurance policies can stabilize costs and provide employees with much needed security during a time of duress.

  • The waiver of premium feature is inadequate because staff must be totally and permanently disabled for at least 6-months before they qualify.
  • The conversion feature is inadequate because the only products available to terminated staff are very expensive.

    Products

  • 10-year guaranteed renewable term insurance.
  • 20-year guaranteed paid-up life insurance.

    Why It Works
    The fundamental principle of life insurance is the spreading of risk amongst a group of individuals, who each have a low probability of that occurrence taking place. When a person makes an individual decision to purchase life insurance, the insurer needs to make sure that the person does indeed have a low probability of death. They check the applicant’s medical condition as well as their medical, financial, personal, and family histories. The process is time consuming and intrusive.

    However, when a group of people make a decision to obtain life insurance, the insurer can expect a reasonable distribution of low, medium and high risks. Provided that a reasonable number of members participate, the standards for qualifying for coverage can be significantly reduced.

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