Life insurance nowadays is not only for personal use but has also been taken out by owners to protect their business. It is essential to the financial security of a business. It can cover certain people or a group of employees in the business.
What is Business Life Insurance?
Business life insurance usually provides coverage in the event that a key person dies. The beneficiary in a business life insurance is the company, unlike in other policies. Business life insurance, also known as key employee policy, can assist the company with the range of consequences that may arise when an owner or key person can no longer fulfill his/her responsibilities in the company. Business life can be especially important to small companies such that it can help the surviving partner or the beneficiaries of the deceased to keep the business until such time that they have decided about the future disposition of the company – whether to continue operations, put the business up for sale, or to shut down the company and sell the assets.
What is Group Term Life Insurance?
Group term life insurance, a yearly renewable insurance, covers a group of people, usually employees for a term period and does not accumulate value. A group term life insurance, or employee group life insurance, provides benefit to the beneficiaries if the covered individual dies during the defined covered period of the employee. Group term is generally cheaper than individual insurance policy coverage. The premiums are experienced rated, based on the company’s deaths, and range of employees’ ages. Employee group life insurance helps pay off existing debts and provides relief to the dependents should something happen to the covered employee. Group term life insurance provides a simple, temporary, term coverage and the premiums start lower, increasing upon renewal as you age.