Group life insurance pays a benefit to an employee’s beneficiaries at death, often as employer-paid basic coverage set to a multiple of pay, with options to buy more. Employer-paid coverage above 50,000 dollars creates imputed income for the employee.
Benefit amounts above the plan’s guaranteed-issue limit usually require each electing employee to complete Evidence of Insurability (medical underwriting). Watch the guarantee-issue maximum, participation rules, the EOI process, and rate stability.
Yes, partly. The cost of employer-paid group term life coverage above $50,000 is ‘imputed income’, a taxable amount (based on an IRS age-based table) added to the employee’s wages, even though the employee doesn’t receive cash.
Group term life insurance pays a benefit to your beneficiary if you die while covered (often 1 to 2× salary as employer-paid “basic,” plus optional employee-paid amounts). AD&D pays a separate benefit only for death or specified injuries caused by an accident; it’s much narrower and is not a substitute for life insurance.