Group Universal Life Insurance – Benefits and advantages

Group Universal Life Insurance option is mutually beneficial to the employer and employee. The employer is able to attract or retain efficient workforce and the employee is able to opt for an insurance coverage at a hugely reduced cost. The policy in itself is a very attractive package. GUL manages to offer flexibility in all the three components of insurance plans. The insurance coverage under this policy can be increased in predefined increments, as per the requirements of the insured. This allows the insured to increase the value of his coverage without having to take a new policy. The insured also can avail the benefit of increasing or decreasing the premium amounts, in accordance to the income situation.

Another hugely attractive benefit with Group Universal Life Insurance is the tax deferral umbrella. The cash value earnings and premiums paid, do not fall under the tax radar and this is vastly beneficial to the employees who can use their policies for the much needed tax relief on their incomes. The premium payment options vary according to each company’s specifications. The employer can choose to cover the entire premium of the employee or may pay half of the premium, leaving the rest to be paid by the employee. This enables the employee to double his coverage, if he wishes to. The employees also must understand that the premium benefits and discounts that are availed through the employer are only valid till the time they are employed in the organization. If the employee chooses to leave the organization, he will not be entitled to these perks but can be assured that the policy will continue to be in force as long as he continues his premium payments, at regular costs. This very feature also enables the Group Universal Life Insurance policies to work as a viable and attractive retirement fund vehicle.

The other advantages that the employee benefits from are:

No medical examination – If the employees enroll themselves for the Group Universal Life Insurance policies within the stipulated time period, they do not need to undergo any medical examinations.

No tax penalties on cash value withdrawals – Most of the GUL coverage plans include the benefit of tax penalty exceptions, for the partly withdrawn cash value amount.

Living benefit option – GUL also offers the facility of accessing the cash value benefit by people who are terminally ill or disabled, to be used for medical expenses. The withdrawn amount is tax free.

Policy coverage for family members – Many companies also provide additional coverage to the family members of the employee. This attractive option is used as a selling point by employers while negotiating with potential employees.

Flexibility – The insured person has an option to completely stop the premiums for a length of time and yet have an effective policy in force. This feature is an USP for Group Universal Life Insurance policies. Added to this, are the flexibilities in coverage, premium payments and cash value options.

The advantages offered by Group Universal Life Insurance policies far outweigh the draw backs (if any at all). If an employer offers this policy to the employees, there is no reason compelling enough for the employees to not take this up and benefit.

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