Group insurance plans

Group insurance plans

• A group insurance policy provides insurance protection to a group of people who are brought together for a common objective. 
• The group of people can be: 

1. employees of an organization; 
2. customers of a bank; 
3. members of a trade union; 
4. members of a professional body like an association of accountants; or 
5. any other group of people who have come together with a commonality of purpose or are linked to each other for a common objective. 

• In a group insurance policy the insurance company issues one master policy covering all the members of the group. For example, the insurance company will issue a master policy to an employer covering all the employees of the company. The employer would be known as the ‘master policyholder’. 
• The contract of insurance is between the master policyholder and the insurance company. The employees are not a direct party to the insurance contract. 
• Group insurance schemes are also used by the Government as instruments of social welfare to provide insurance cover to the masses (people who are below the poverty line). 
• In July 2005 the insurance industry regulator (IRDA) issued guidelines on group insurance policies.

Anand Khemka
+91-9910936925
+91-8287041341