What’s the difference between a group life insurance policy and an individual policy?

Life insurance is an important financial product that provides financial protection to the insured's family or beneficiaries in the event of the insured's death. There are two main types of life insurance policies: group life insurance policies and individual life insurance policies. Here are the key differences between them:

• Policyholder: In an individual life insurance policy, the policyholder is an individual person who purchases the policy for themselves. In contrast, in a group life insurance policy, the policyholder is typically an employer or an organization that purchases the policy for a group of individuals (usually employees or members).
• Coverage: Individual life insurance policies are tailored to the specific needs of the policyholder and can provide a range of coverage amounts and options. Group life insurance policies, on the other hand, typically provide a set amount of coverage to all members of the group.
• Premiums: In an individual life insurance policy, the premiums are determined based on the individual's age, health, and other factors. In contrast, group life insurance policies usually have lower premiums because the risk is spread across a larger group of people, and the employer or organization often pays a portion of the premium.
• Underwriting: Individual life insurance policies usually require a medical exam and underwriting process to determine the individual's health risk and premium. In contrast, group life insurance policies typically do not require a medical exam, and all members of the group are generally accepted regardless of their health status.
• Portability: Individual life insurance policies are usually portable, which means the policyholder can take the policy with them if they leave their job or organization. Group life insurance policies, on the other hand, are generally not portable, and the coverage typically ends when the member leaves the group.
• Control: In an individual life insurance policy, the policyholder has complete control over the policy, including the amount of coverage, beneficiaries, and other policy terms. In contrast, in a group life insurance policy, the employer or organization usually has more control over the policy and the terms of coverage.

In summary, while both group and individual life insurance policies provide financial protection to the insured's family or beneficiaries, the key differences lie in the policyholder, coverage, premiums, underwriting, portability, and control. It's important to carefully consider your specific needs and circumstances when choosing between these two types of policies.