Group insurance is one of the most common ways businesses, and associations provide insurance benefits for their members. There's a good reason for this. Insurance is one of the best benefits you can offer to your employees. A well-constructed benefits plan helps build employee loyalty, engagement and is a great tool to recruit and retain your best employees.
What is group insurance and how does it differ from 'regular' insurance?
Group insurance is 'regular' insurance. The insurance itself doesn't differ from individual policies, except in one category, price. The benefits of the insurance, the coverage, and the way you use the insurance are virtually the same.
Underwriters will look at the group of people applying for the insurance and create a composite profile. Using this profile, they assign levels of risk for the group, and this determines the premium.
This helps keep costs down because, in a large group of people with varying levels of individual risks, people with lower risk levels help mitigate the costs of people with higher risks levels. This isn't possible with individual policies because there are no mitigating factors for the risks of one person.
As your company grows and you add more people to the group policy, it is possible for the risk factors to drop and your premiums to go down.
How big does my company have to be to qualify for group insurance?
Companies or associations can qualify for group insurance with as few as two employees. However, keep in mind the lower the number of people in the group, the higher the premiums are going to be. Some people might find there really isn't a change in their insurance cost when a policy is purchased for only two people.
For sole proprietorships, the owner's private policy is the insurance plan.
Is this only open to businesses?
No, other organizations can also offer insurance to its members. For example, a fraternal organization, a union, or a local group of artisans can offer group rates to its members. We're not talking about only health insurance. Other insurance policies may benefit individuals in a group or association.
What kinds of insurance can be bought for groups?
The most common types of insurance that companies and associations purchase are health, life, some types of liability, and personal protection insurance. Additionally, associations of professionals, such as accountant and attorneys, can purchase group policies written explicitly for their profession.
Who can sell you a group policy?
Contact your local insurance broker and ask them about what group policies they offer to your business. They're the experts in group insurance and can help you select the right policies at the correct levels of protection.
Culture Insurance works with a variety of businesses and other groups in establishing insurance plans that are both effective and economical. If you are looking to improve the benefits package your company offers, we invite you to contact us to learn how we can help you.