Group Term Life and your
Employees
Working your entire career at
large companies you’ve noticed
term life insurance as a benefit
of employment. You’ve even
likely taken it for granted, the
way you might look at possible
term life coverage included with
a premium services credit card.
You thought, oh that’s
interesting but I’ll never use
it and it’s probably not worth
the paper it printed on. But
now, faced with owning your own
business or purchasing benefits
for a small California group it
suddenly becomes important and
very real. How much should you
buy? What does it cost? What
proportions should be available
to staff employees versus
management. Check our
Qualifying for Coverage
section to find out if your
business can obtain small group
term life in California.
Term Life Cost To run a
formal quote for California
Small Group term life insurance
visit our
instant quoting engine here.
The cost in recent years
of term life coverage has come
down largely in part due to the
increased availability of
pricing and ease of comparison
shopping over the Internet.
Term life is very simple to
compare from one company to the
next because it is just benefit
amount and term of policy. Term
life policies are relatively
inexpensive and accrue no cash
value.
How Much Should You Purchase? Term
life offered through a small
business employer is usually
supplemental in terms of the
total amount an employee with a
family might purchase to cover
the costs of mortgages,
retirement, and college
education of surviving family
members. Frequent offered
ranges are the minimum
‘guaranteed issue’ amount levels
which are around 25k for
companies under 10 employees.
Quantity Levels and Policy
Offer Structure The
insurers will have different
packages available but commonly
you will see the ability to
offer term life as
a)
Minimum guaranteed issue level
regardless of employee health at
around 25k
b)
The
ability to offer a flat amount
larger in a non-guaranteed
fashion
c)
Multiple offers where coverage
amount term and cost is a factor
of salary. For example 2 x
salaries is a common package
offer.
Supplemental Life Supplemental
Life coverage is 100% employee
paid term life coverage where an
employee requests additional
amounts of term life coverage
beyond the benefit offer the
small business makes available.
Supplemental life is not
guaranteed to be issue to the
employee and the health insurer
will place a limit on the amount
possible to obtain.
Dependent Life Dependent
life can be made available for
employers looking to provide
every benefit possible as a low
cost product an employee may
never buy themselves. Dependent
life coverage will also be made
available in small amounts like
the 10k level.
Composite
Pricing Standard
pricing for term life is based
on the age and zip code of the
employee, known as age-banded
pricing. Once a small business
in California reaches a critical
mass of size it may be possible
to receive composite pricing, or
a single rate of pricing broken
out by amount or salary factor
regardless of the age of the
employee. Composite pricing is
not available everywhere and at
all company sizes so check
before you purchase if
interested.
Other
important
resources:
California
Small Group
health quote
California
Small Group
online
doctor
listing
California
Group
Enrollment
and
Eligibility
Center
