Group term Life Insurance
As the name indicates, group life insurance provides coverage to a group of people through a single contract. A company or an employer usually purchases it to provide insurance to its or his employees. It is a type of term life insurance in which the policyholder is the employer, but the insurers are the employees. Depending on the companies, employees have to pay a little or no money for the policy premiums.
Every employee becomes a part of this policy after spending a specific period in the company, which may vary as per the companies’ policies. However, he is not allowed to take the policy with him if he decides to leave the job. Some companies do provide the option of shifting group insurance to individual insurance. However, the process is costly and hence, is not preferred.
Group term life insurance offers a decent coverage of around $50,000 usually. It also provides the option of adding riders or additional coverage for the families of the employees.