Group Insurance Plans and Policies

Group insurance is an insurance that covers a defined group of people, for example, the members of a society or professional association, or the employees of a particular employer. Group coverage can help reduce the problem of adverse selection by creating a pool of people eligible to purchase insurance who belong to the group for reasons other than the wish to buy insurance, which might be because they are a worse than average risk. Grouping individuals together, allow insurance companies to give lower rates to companies.

There are only two main parties involved in Group Insurance Plans.

1. Insurance Companies

2. Employer/Employees.

There are many benefits of taking a group insurance plan rather than buying different plans for every Individual. Buying insurance plans separately can be a costly affair. However, when there is a huge group of people which can be categorized into groups for buying the same insurance policy, then group plans create a huge difference in terms of expenses incurred in buying those policies. Insurance companies provide special rates at which they cater a unique policy for the group. Insurance companies reduce the rates as administration costs and expected claim costs are lower. Also, they get complete details of all the people in the group as there is a master policyholder who retains all the documents, including those which are needed by the insurance companies, on behalf of the insurer.

Hence, a group providing a large volume of business to insurance companies gives them greater bargaining power for clients, resulting in cheaper group rates.

Not all employee benefit plans are created equally. Back then we had little to choose from and although a standard plan is still very popular there are other options designed to accomplish the same thing and save you considerable money. From health trusts to traditional plans to a combination package, every insurance plans can be catered according to the needs of the group. So before getting a Group Plan do compare all the plans and select the best out of it.

If you are not sure how to choose the best insurance plans for your group or are confused by the vast variety of insurance plans, then don’t worry as Phil Edney is our Life and Health specialist with over 25 years in the business. Phil’s knowledge and expertise will assist you with your insurance decisions. He works with all of the major carriers to find the right product at the right price for you.

For more information on Group Plans then Visit: http://discoveryinsurance.net/group_plans_victoria.php

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Original Source: https://medium.com/@discoveryinsurance123/group-insurance-plans-and-policies-2e2f0fb40d4d

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