GROUP LIFE ASSURANCE BENEFIT SCHEME

A group life insurance contract covers the members of a particular group.

The group could be employees, members of a club, society, association,

church, mosque etc. It provides financial compensation in the event of death

of a member of the group.

As stated above, the Pension Reform Act 2004 requires employers of labour to

provide life insurance cover for their employees. The minimum benefit specified

by the Act is three times the employee’s total emolument.

AIMS OF THE SCHEME

The main aims of a Group life scheme are as follows:

v To provide specified benefits on death of an employee (minimum of 3 times total emolument)

v To relieve the employer of financial commitments associated with employee’s

death (e.g. compulsory payments, burial cost etc)

v To attract and retain good employees

v To create goodwill between the employer and the employees

v To give peace of mind to the employees while working

v To comply with the provisions of the law