Can Group Life Insurance Cover More Serious Health Issues?

Group life insurance can be an excellent benefit for employees, providing a lump sum payment (potentially tax free depending on setup) to the family members or beneficiaries of protected team members.  

Group life comes with a number of benefits for employers and employees alike, including cost efficiency, enhanced cover where individual insurance may not be available, and much more. 

But can group life insurance cover more serious health issues and what is the best way to get covered for more serious health concerns?

What standard group life insurance normally covers

Whilst coverage will vary from policy to policy, standard coverage involves death as a result of illness such as cancer, heart attacks and more fatal accidents, such as a road traffic accident or death resulting from criminal acts. 

Policies generally have a suicide exclusion for the first 12 – 24 months, and death from extreme sports or hobbies may also not be included.

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Does group life insurance cover serious illness?

Standard group life insurance typically pays out in the event of death as a result of serious illness, however, it will only cover your beneficiaries after death, as opposed to paying out following a diagnosis.
 
This would fall under a ‘group critical illness’ policy, where extra coverage would pay out a lump sum in the event of diagnosis with a serious illness.

Can group life insurance cover more serious health issues?

Usually, group life insurance can cover individuals with more serious health issues. In fact, it’s usually one of the better options for people who have been denied life insurance previously. 

There are a number of reasons for which group life insurance is actually an ideal choice for those with more serious health issues:

• Pooled risk – When grouped with a number of other individuals under the same policy, the insurer views the ‘perceived risk’ of the group as a whole, not you as an individual. As a result, they will take your illness into account, but it will not have anywhere near the same impact as it would for individual life insurance. 

• Minimal underwriting – Group policies typically don’t require medical underwriting, being automatically covered without needing to divulge in-depth medical details or history. 
  
• Covers pre-existing conditions – Death in service insurance typically covers pre-existing conditions under the base plan. So even if death results from these conditions, your family will be protected. 

Critical illness and group life insurance

Group life insurance and critical illness insurance can be combined to give the best possible protection for individuals with more serious health issues but it’s important to understand what each policy typically means/involves, and how/when combining them is a good idea.

Group life pays out in the event of your death,whilst currently in employment. So, if you had a serious illness from the start of the policy, or you are diagnosed with one after the policy starts, your beneficiaries will receive a tax-free lump sum when you pass away. 

secure the most appropriate life insurance for your circumstances, give us a call on 01204 866902.

The best ways to cover yourself in the event of a serious health issue

The best ways to cover yourself in the event of a serious health issue depends on whether you already have a diagnosis. If you’re already diagnosed, you most likely won’t be able to get critical illness cover, so you should speak to your employer about group life insurance to protect your family.   

If you don’t have any serious diagnoses currently, your best option might be to get critical illness cover, which will payout in the event of any future diagnosis, often including illnesses which aren’t necessarily terminal, and other benefits such as children’s cover and the ability to cover treatment. 

The nuances of all forms of life and critical illness insurance mean that each policy is different, and there isn’t a ‘one size fits all’ approach to getting the coverage you need. 

The best way to achieve peace of mind with a policy perfectly suited to your situation and needs is to speak with an intermediary such as Dragonfly Crowd, who can search a wide range of insurers to find the exact policy you need. Get in touch today to find out. 

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