Group Term Life Insurance


Also found in: Acronyms.

Group Term Life Insurance

Life insurance coverage purchased by an employer for a group of employees. Such insurance is renewable on a year-to-year basis and does not accumulate in value; that is, no cash surrender value is built up. The premiums paid by the employer on such insurance are usually not taxed to an employee unless coverage exceeds $50,000.
Mentioned in ?
References in periodicals archive ?
If the plan provides group term life insurance that is discriminatory, the exclusion is not available to key employees.
Group term life insurance must meet four basic requirements:
Cost of Group Term Life Insurance in Excess of $50,000 Employee's Date of Birth: January 1, 1955 (Age: 52) End Employer's Taxable Year: Calendar Employee's Contribution: $0 Employee's Tax Bracket: 28.00% Level Amount of Group Insurance: $150,000 Cost of Group Term Insurance: $276 Estimated Tax on Term Group Insurance: $78 Assume further that the employee contributes 15<J per month per $1,000 of insurance.
The employer provides her with $150,000 of group term life insurance. She makes no contribution to the coverage.
Consequently, corporations use executive life insurance arrangements to overcome group term life insurance limitations.
SDLI Arrangement Defined--Under these proposals, an SDLI arrangement is defined, generally, as any arrangement that is not part of a group term life insurance plan described in IRC Sec.
* An employer who wants to provide permanent coverage for selected employees and recognizes the inherent disadvantages with using some form of group term life insurance plan, both from the non-discrimination-in-coverage requirements as well as the concern about loss of coverage for employees when retirement age is reached.
Insured employees must file an IRS PS-58 on their annual W-2 tax form -- meaning employees must report a small portion of taxable income if the firm's group term life insurance premiums top $50,000, Ervin said.
Employers are also permitted to make contributions to medical savings accounts (MSAs) and provide a limited amount of group term life insurance as well as provide certain fringe benefits (such as free employee parking).
You can't name your own price for group term life insurance yet, but Group Life.com Inc.
Recently, the utility discovered an affordable group term life insurance plan for lower-level employees, and began offering it three months earlier in order to retain key workers such as David, who have critical expertise and skills.
Options include major medical insurance, disability income insurance, group term life insurance, dental insurance, group accidental death and dismemberment insurance, Section 125 plans, and retirement programs.