Focusing on the Employees of Corporate Organizations, Government Corporations and/or Establishments
Based on the term group, this is an auto insurance policy that covers the collection of people that came together to achieve a specified purpose. Here, specifically we are focusing on the employees of corporate organizations, government corporations and/or establishments.
Generally, group insurance is usually arranged to cover personal
insurances (risks) such as auto insurance, life assurance and health
insurance. In providing this type of insurance, the underwriters have
two types of insurance cover.
Option 1: This is the cover on the subject-matter of insurance, that is
the vehicle and the cover are detailed below;
- Comprehensive
- Collision
- Liability
- Rental car
- Oversight cover.
Option 2: These are the statutory accident benefits that are optional
like;
- Death benefit
- Income replacement
- Caregiver benefit
- Total incapacitation benefit.
The process of underwriting auto insurance risks involved the
consideration of different factors but these are jettisoned for the
purpose of group insurance. The insurance companies bear in mind
the volume of people covered and the diverse nature of the risks
involved. This eliminates the problem of adverse risk selection
against any member of the group.
For ease of administration, the insurer will issue a single policy to
employer termed Master policyholder. It the duty of the employers to
appoint a unit within their establishment to handle issue relating to
insurance and become the communication link between the
employer/employee and insurance company. This unit is saddled
with the responsibility of dealing with the insurers in time of new
business, deletion of vehicles, additional vehicles, annual renewal
and claims notification until settlement.
In view of the aforesaid, premium payable is very low due to the
discounted rate given by the underwriters. This is premised on the
fact that the large volume of employees (e. g 10, 000 for a big
corporation) gives the employers the bargaining power of lower
premium and premium payable may just be around 25 – 30% of the
actual premium. Depending on the employers, premium payment
may be by direct monthly billing or payroll deductions.
Personal Package Insurance Policy
Personal package policy is a modification to the method of issuing
single insurance policy per risk, thus a process of combining more
than one risk/policy as a package insurance policy. These include
auto, home, excess liability, boat or yacht etc. Before we continue to delve into the intricacies of personal package policy, let us first consider the benefits/advantages derivable under this insurance.
Hefty premium discount is available to you rather than when you
cover each risk under a separate policy. Combined and lower deductibles. Normally, each class of insurance has applicable deductible and when the insurances are package into a single policy, your deductible is at the barest minimum.
Better insurance coverage. The umbrella cover extension under the
package insurance placed you under better protection compare with
other classes where such extension is not available. Flexible terms, conditions and warranties. Actually, all insurance policies are subject to terms, conditions, exceptions and warranties and non-compliance with these requirements form the basis of repudiating a claim.
Under package insurance, these stringent rules are more relaxed due to combination of policy involved and loyalty of the customer by trusting the insurance company with all the personal/property insurances.
Single effective and renewal date. Your insurance policy is having a
single renewal date. So, the palaver of several renewal dates of
different policies are taken off your neck. Also issue of error and
omission has become things of the past.
Ease of monthly premium payment. Just one remittance every
month, the difficulty of agglomerating premium under different
policies and charges associated with such remittance is taken off.
Dealings with one insurance company only. You are having just one
underwriter and this save you the time and trouble of transacting
business with many insurance companies.
Ease of administration. With package insurance policy, the insurers
find it easier to be in-charge than underwriting each risk under
separate policy. Therefore, the workload is drastically reduced in
term of documentations.
Now that we scrutinized the benefits under personal package
insurance policy, there is need to dig a little deep into policy
coverage. Here we are considering the additional cover or
extensions available under this policy.
Umbrella insurance. This cover serves as a safe haven when the
underlying liability limits is exceeded. The excess liability that
supposed to fall back to the policyholder is been shouldered under
the umbrella covers.
Valuable insurance. The householder comprehensive covers the
property at home and there is limitation under the policy. Therefore,
other valuable items such as fur coats, work of arts, antiques,
jewelry’s, and collectibles are covered by extension under the
package insurance policy.
Watercrafts. As a matter of fact, some countries or cities are
surrounded by water. It is not uncommon that transit by water is the
major way of life connecting of area to the other. The possession
and/or usage of boats, yacht and other vessels are daily routine,
these vessels can be covered under the extension of the personal
package insurance policy.
Other risks/coverage. These can be bundle under the package
policy, they include;
- Rental and landlord insurance.
- Flood insurance.
- Earthquake insurance.
- Cyber insurance.
- Identify fraud protection
- Recreational vehicle insurance.
What is “Term Group”?
It is an insurance arrangement where the insurance companies put into consideration the law of large number to form a pool of risks.
