Group insurance is offered to a group, usually through employment or a trade association, explains InvestorWords. The insurance provides coverage to individuals in the employment entity or trade association along with their dependents.Continue Reading
Employers or trade associations may offer a group health insurance plan to their members or employees as a major benefit, according to Investopedia. The plans are generally the same and are offered to all employees or members of the group. Group health insurance plans are usually offered at a discounted cost for participants compared to individual plans that have the same coverage. This is because the risk is spread entirely over the group as opposed to one person. If the insurer bears the cost of the premium, then the cost is tax-deductible. Benefits received by group members are tax-free.
Employers and trade associations may also offer group life insurance as part of a benefits package, states Investopedia. When life insurance is offered through a provider on a wholesale basis, the cost is less than each individual pays if he purchases an individual policy. Members receiving coverage may not have to pay out of pocket for benefits or could elect to have their portion of the premium deducted from their salaries.Learn more about Insurance