Group Universal Life Insurance
Group universal life insurance is a benefit provided by employers for employees. A universal policy is a great addition to the menu of benefits provided by the company, and can be entirely employer paid or employee paid. Employees benefit when taking GUL while with an employer, because companies get discounts on insurances due to the fact that there are so many people in the group participating in the insurance. If universal policies are purchased individually, the discount is not available. However, the individual coverage may go up in price after the employee leaves the company, even though the policy remains the same and continues. Monthly or bi-weekly premiums are paid as payroll deductions and continue until either the company decides to no longer offer the benefit, or until the employee no longer wants to participate. Employees will most likely be able to participate without having to submit to medical examinations, as long as enrollment takes place during specified times as indicated by the employer.
Employees will be pleasantly surprised to learn that money deposited into a group universal life insurance policy grows tax-deferred over time. When the company also offers a 401(k) plan as well, then there are two opportunities for significant savings toward retirement, as well as a tool for ensuring money will be coming in after retirement in the form of either a lump sum payment or equal payments provided over the life of the policy holder. Of course the individual will want to ensure that the tenure with the company is a long one in order to continue to take advantage of this wonderful savings tool. Human resource professionals can utilize this type of benefit as a means to lure qualified and talented employees into the company as often happens. Also, providers usually offer the group universal life insurance to the dependents of the employees as well, making it even more attractive, and likely that the participant will stay enrolled for quite a long time.
Group universal life insurance programs will often offer some ancillary programs attached to the policy the employee purchases, such as legal help in the preparation of personal wills. Also, estate planning may be available. These attached benefits can end up saving the individual quite a lot of money. Those consulting with lawyers on the same matters outside of employer sponsored benefit plans will find these services to be quite expensive. If the employer offers a group universal life insurance program, the employee would be wise to take part in it to the fullest extent. So many people wait until middle-age before thinking about retirement, wills and estates. This may be because younger people feel that retirement is so far into the future, or they may not have yet accumulated enough assets to make it important enough to them. "The Lord is my rock, and my deliverer; my God, my strength, in whom I will trust; my buckler, and the horn of my salvation, and my high tower" (Psalms 18:2 KJV).
A feature of many group universal life insurance policies is that coverage is available for those people who become disabled and can no longer work. The lower cut off age is as low as 16, and the highest is 75 years old. The range of age may vary depending on the company that offers the policy so be sure to check this out and fully understand how the insurance works. If the individual cannot pay the required premiums to keep the policy in force, this will not be a problem, as the coverage is designed to allow for this. A feature such as this would be a great relief when no other alternative is available for income a difficult time such as this. Coverage amounts can be available for as little as $25,000 or as high as $100,000, depending on the needs and income of the individual taking the policy. There are also options that allow people with terminal illnesses to withdraw funds while still living in order to pay the expensive medical bills that will be inevitable.
Employers can utilize group universal life insurance programs as a means to own life coverage on the employees and use the funds accumulated tax free over time to take care of future liabilities. This may be a less known or less utilized avenue, but would be a creative approach to the problem. Accountants may appreciate the suggestion from management to find more ways to handle the assets. Since these policies may be used to take care of liabilities, it is in the interest of the employer to consider what type of rate should be taken advantage of for the investment. For example, most GUL's have a fixed rate of growth, but there are also opportunities to purchase variable life policies that may be able to grow faster, depending on the performance of the fund.
As with any group universal life insurance policy, there will be exclusions included which should be read and fully understood. For example, there is what is referred to as accidental death exclusions that will pay out percentages of the policy depending on the type of accident which occurred.
Not all accidental deaths are coverable however, and so the purchaser should discuss the exclusions with the provider. Some other types of exclusions, such as the terminal illness situation mentioned earlier, will require that the life expectancy be six months or less. Some other companies may allow a life expectancy of up to two years out. Should any money be taken out for this purpose, the total amount of the policy will be reduced by the amount paid out. Understanding all elements of a policy is key to feeling secure with the insurance investments in later life, when the time comes to begin using them.
Employees will be pleasantly surprised to learn that money deposited into a group universal life insurance policy grows tax-deferred over time. When the company also offers a 401(k) plan as well, then there are two opportunities for significant savings toward retirement, as well as a tool for ensuring money will be coming in after retirement in the form of either a lump sum payment or equal payments provided over the life of the policy holder. Of course the individual will want to ensure that the tenure with the company is a long one in order to continue to take advantage of this wonderful savings tool. Human resource professionals can utilize this type of benefit as a means to lure qualified and talented employees into the company as often happens. Also, providers usually offer the group universal life insurance to the dependents of the employees as well, making it even more attractive, and likely that the participant will stay enrolled for quite a long time.
Group universal life insurance programs will often offer some ancillary programs attached to the policy the employee purchases, such as legal help in the preparation of personal wills. Also, estate planning may be available. These attached benefits can end up saving the individual quite a lot of money. Those consulting with lawyers on the same matters outside of employer sponsored benefit plans will find these services to be quite expensive. If the employer offers a group universal life insurance program, the employee would be wise to take part in it to the fullest extent. So many people wait until middle-age before thinking about retirement, wills and estates. This may be because younger people feel that retirement is so far into the future, or they may not have yet accumulated enough assets to make it important enough to them. "The Lord is my rock, and my deliverer; my God, my strength, in whom I will trust; my buckler, and the horn of my salvation, and my high tower" (Psalms 18:2 KJV).
A feature of many group universal life insurance policies is that coverage is available for those people who become disabled and can no longer work. The lower cut off age is as low as 16, and the highest is 75 years old. The range of age may vary depending on the company that offers the policy so be sure to check this out and fully understand how the insurance works. If the individual cannot pay the required premiums to keep the policy in force, this will not be a problem, as the coverage is designed to allow for this. A feature such as this would be a great relief when no other alternative is available for income a difficult time such as this. Coverage amounts can be available for as little as $25,000 or as high as $100,000, depending on the needs and income of the individual taking the policy. There are also options that allow people with terminal illnesses to withdraw funds while still living in order to pay the expensive medical bills that will be inevitable.
Employers can utilize group universal life insurance programs as a means to own life coverage on the employees and use the funds accumulated tax free over time to take care of future liabilities. This may be a less known or less utilized avenue, but would be a creative approach to the problem. Accountants may appreciate the suggestion from management to find more ways to handle the assets. Since these policies may be used to take care of liabilities, it is in the interest of the employer to consider what type of rate should be taken advantage of for the investment. For example, most GUL's have a fixed rate of growth, but there are also opportunities to purchase variable life policies that may be able to grow faster, depending on the performance of the fund.
As with any group universal life insurance policy, there will be exclusions included which should be read and fully understood. For example, there is what is referred to as accidental death exclusions that will pay out percentages of the policy depending on the type of accident which occurred.
Not all accidental deaths are coverable however, and so the purchaser should discuss the exclusions with the provider. Some other types of exclusions, such as the terminal illness situation mentioned earlier, will require that the life expectancy be six months or less. Some other companies may allow a life expectancy of up to two years out. Should any money be taken out for this purpose, the total amount of the policy will be reduced by the amount paid out. Understanding all elements of a policy is key to feeling secure with the insurance investments in later life, when the time comes to begin using them.
Group Universal Life Insurance
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