Group Term Life Insurance
Definition - What does Group Term Life Insurance mean?
Group term life insurance is a life insurance policy that is offered to employees of a company or members of an organization. In most cases, the employer pays all or a portion of the premium, or membership in the organization provides a premium discount.
Insuranceopedia explains Group Term Life Insurance
Like all group insurance, group term life insurance is priced lower than individual insurance. Moreover, unlike individual life insurance policies, the application process does not involve medical testing.
If an employee wishes to have coverage beyond what is provided by their employer, they can pay a higher premium to acquire that extra coverage. Coverage can differ from one employee to another for various reasons, including seniority or salary range.
The US government does not tax group life insurance if the policies provided to the group do not exceed a total of $50,000.