Understanding Group Life Assurance policy
Sunny Nwachukwu (Loyal Sigmite), PhD, a pure and applied chemist with an MBA in management, is an Onitsha based industrialist, a fellow of ICCON, and vice president, finance, Onitsha Chamber of Commerce. He can be reached on +234 803 318 2105 (text only) or schubltd@yahoo.com
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The life span of the Group life Assurance Policy is yearly, subject to the renewal of the policy, upon payment of premium.
A group life assurance policy is not a pension plan. Thus, it is only the stated beneficiaries of the deceased that will be paid.
The premium is paid once a year.
Once again, the death claim will be paid to the stated beneficiaries of the deceased.
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Once again, a group life assurance policy is not a pension plan. Thus, there is no stated maturity year of the group life assurance policy. The claim is paid to the stated beneficiaries of the group life assurance policy, when a participant in the group life assurance policy passes on.
The group life assurance policy is issued in the name of the group/association/union/club/alumni/old boys’/estate residents’ association, community, etc. Those who paid a premium are participants. The death claim cheque will be paid to the association, e.t.c. The association will in turn pay to the stated beneficiaries of the deceased.
You reserve the right to change your beneficiaries, by notifying the insurance broker and the leadership of your association, e.t.c.
Once your beneficiaries are paid, the name of the deceased will be deleted from the group life assurance, by the insurance firm.
Your beneficiary(s) will be paid only once.
Upon attaining the age of 70, the name of the participant, who has attained the age of 70, will be DELETED from the group life assurance policy by the insurance firm.
The overall objective of an insurance policy is PROTECTION.
Insurance is predicated on the following key principles and fundamentals: Utmost Good Faith; Indemnity; Subrogation; Contribution; the insurance firm’s right of Salvage; the statistical and the actuarial laws of Large Numbers; the engagement of External Consultants (Actuarial Consultants, Marine Risk Surveyor’s, Fire Risk Surveyors, Claim Investigators, Loss Adjuster’s, e.t.c.); Reinsurance Treaty; Retrocession Treaty; and the diligent application of Risk Management, which is the germane reason why insurance firms have a Risk Management department.