Understanding Group Life Insurance

Group life insurance historically was based on the risk characteristics of the group as a whole without the intensive underwriting of each member, recognizing that some members of the group would be less of a risk than others. Further, many groups purchasing group life insurance generally were strongly cohesive with many common characteristics linking all members of the group. For example, all employees of an established company such as General Motors or a group of lawyers are all generally considered to be healthy to perform the tasks at hand and they rarely engage in risky behavior related to the job. This produces savings for members, as it lowers the costs of underwriting and issuing policies