Introduction

Group insurance is a cost effective way of providing protection against the financial loses caused by death, disability or retirement to a group of individuals who are associated with the policyholder by some common relationship other than insurance.

Pragati Life offers group insurance schemes to various groups such as Employer-Employee, Professionals, Co-operatives, and NGOs etc. The main feature of the schemes are low premium, simple insurable conditions such as employee not being absent from duty on grounds of ill health on the day of entry, and easy administration by way of issue of a single master policy covering all the employees/members. Group insurance is usually a service benefit provided by the employer to its employees.

How the Employer Benefits

Most employers provide group life/hospitalization insurance as a service benefit. By providing employees with a plan of group life/ hospitalization insurance coverage, an employer derives the following benefits:

• It contributes to employee morale and productivity.

• It helps to recruit and retain employees.

• Employer can obtain a Tax deduction for the cost of contributing to the plan.

• Employer’s public and employee relations image is enhanced.

How the Employee Benefits

Individuals and families have a great need for life and health insurance plans. Unfortunately, many people are unable to purchase individual coverage because of preexisting medical conditions and/or the high cost of purchasing insurance. Therefore, many people rely on employer-sponsored plans as their sole source of life and health insurance. An employer-sponsored plan provides the following benefits for employees:

• Virtually all members of a given group may be insured, regardless of their prior health history.

• If the plan is contributory, the employee usually pays a lower rate per unit of benefits than is available with individual coverage.

• If the plan is noncontributory, the employer pays for coverage that employees would otherwise have to pay for with personal money.