Group Life & Critical Illness InsuranceGroup Life & Critical Illness documents
Group LifeGroup Life Policies are commonly provided on the basis of:
- A flat sum Insured
- A multiple of annual salary.
When we make comparisons of such plans for clients it is not uncommon for the rates to be quite close. What is frequently the differentiating factor is the degree to which various insurers will allow 'free cover'.
Not that the cover is 'free', but this is the amount of cover an insurer will allow to be made available to cover a staff, once he/she is eligible to be given such cover. IF the sum insured for this person is greater than the threshold of cover provided by the insurer, then the employee will need to go for a medical exam.
Depending on the results of such an exam, the staff's additional cover may be declined or rated at a higher premium.
In experience, getting staff to go for a medical exam for such cover can be such that they never get their entitlement of cover.
For this reason, the amount of 'Free cover', will often be the initial deciding factor in an employers' choice of insurer.. especially for salary related schemes, as when people's salaries increase, this increase may push them over the free cover limit and mean they need to go for a medical exam, even though they may have avoided doing this initially.
Occasionally we find clients deciding on which plan to choose depending on which plan will allow cover to continue after the normal retirement age of 65. To date we have only found one insurer willing to allow staff, still actively working, to continue their life cover after age 70.
Group Critical Illness
Critical illness cover is again provided on a lump sum or as some percentage of an employee's salary.
Critical Illness cover pays out the sum insured on diagnosis of heart attack, Stroke and life threatening cancer, plus a range of perhaps 30 other ailments.
Internationally in the group market the maximum cover for Critical Illness is currently around USD500,000.
Commonly this cover will not be granted instantly by insurers who will want to underwrite the employees' health history and the history of his/her relatives.