Employer has certain obligation towards his employees – a few are compulsory like gratuity and employees deposit linked insurance scheme and others are employee benefit schemes.
In india group life scheme prevalent are :
Group term life
Employers, as a part of the employer-employee agreement or the employer being a progressive one may be responsible or volunteer to provide benefits to the dependents of the employee in case of any eventuality such as death. This policy is suitable for such employers who wish to provide insurance cover to all their employees under a single policy at an affordable premium. It is 24 hours worldwide policy which covers natural and accidental death.
Employee deposit linked insurance scheme
The employer may be exempted from contributing to this scheme, if he/she has provided for better insurance benefits through alternative scheme. Group insurance scheme in lieu of edli has been accepted as one such better alternative.
Advantages to the employer is its being cost effective coupled with easy claim procedure & the premium paid is shown as expenses in it.
Group superannuation scheme
With improvement in longevity, need for a regular income after retirement has become a necessity. Any pension scheme introduced by an employer today creates an ideal environment for employees. They are motivated to give their very best to the organization as they derive a sense of security and well-being.
Group gratuity scheme
Creating a privately managed trust, or funding it through insurance company and getting payment as and when liability falls due.
- The fund accrues interest from day one with maximum possible yield.
- For claiming it rebate, valuation done by ic would suffice. No certificate from an outside actuary is required.
Full life cover – an added attraction
- In the event of premature death often employee, the sum payable as gratuity is equal to gratuity payable for the entire service (actual service + anticipated service) under ic’s scheme.