Finding the Best Life Insurance Protection for Your Employees Abroad
When it comes to offering a well-rounded benefits package for international employees, life insurance might not be the first thing you think of. Most companies start with health insurance, but while covering healthcare for your employees and their families is critical, it’s only the baseline. Life insurance is increasingly a major focus for hiring and retaining top talent, who want to make sure that their families will be financially stable if they pass away. Group international life insurance is a perfect solution, and a sound investment for your teams.
What is Group Life Insurance Coverage?
Employee group life insurance is a way for employers to offer coverage to their team at a discount. When you provide this coverage to your employees, you buy a group term life insurance policy that everyone in your business can choose to sign up for. The policy generally has a simple payout structure and can only be used by active, full-time employees of your company. The premiums are low- or no-cost to your employees, and do not require them to undergo medical exams. There are usually some limitations based on things like cause of death, or in the case of international policies, location.
International group life insurance plans cover your employees while they’re working abroad. Sometimes called International Business Life Insurance or International Company Life Insurance, these plans are highly portable and have a simple structure. Unlike many individual life insurance plans, these policies operate nearly anywhere in the world your employees go. You simply buy a plan for your team, decide on the amount of the payout to an employee’s family (usually some multiplier of the employee’s salary), and the plan moves where the employee moves.
If an employee dies, the last thing a family needs is to be worrying about their security on top of their grief. A group term life insurance plan can relieve a family from financial hardship. And with some plans, employees can choose to upgrade to a whole-life policy, with different requirements and premium costs. Either way, the money can be used for things like funeral costs, day-to-day expenses like a mortgage or groceries, and even debts owed.
Also Read: Other International Group Insurance Plans
What Is the Main Advantage of Group Insurance for International Workers?
You may not realize it, but many individual life insurance policies will only cover you if you die in the country where you paid for the insurance. Insurers consider life in many foreign countries a risk, and they often don’t offer coverage in those places — including some countries you might not expect.
Other policies stop covering people if they go overseas for more than three months. After three months abroad, these life insurance plans consider the covered person a foreign national. If your plan has residency requirements, this can exclude them from some death benefits, or from the plan entirely. This is where international group life insurance becomes a much better option.
What Are the Disadvantages of Group Life Insurance?
There are a few exceptions to keep in mind when securing group life insurance benefits for your team. These aren’t exactly “disadvantages,” but rather things to look out for when shopping for life insurance for employees abroad.
- Location. There are some countries that many insurers won’t cover — usually ones listed as “advised against all travel” by government agencies. You should also check whether the company life insurance you’re looking at covers local employees as well as international ones.
- Limitations. Some common limits of these policies include age (generally no older than 65-75), and number of employees (usually three or more). Group plans aren’t life insurance for business partners or sole proprietors.
- Catastrophes and combatants. Life insurance for employees won’t cover employees who are “actively at war.” You should also check the policy’s upper cap for a payout should something catastrophic happen, in which numerous employees all die in a single event.
Why Do Employers Offer Group Insurance?
Both the employees and the employer benefit from group international life insurance. Here are some of the biggest reasons you might want to offer it to your teams:
- Retention. The jet-setters who will perform highly for your company also want to know that their families will be protected. Offering international life insurance through work attracts top talent by showing you care for your people.
- Affordability. Life insurance is one of the lowest-cost forms of coverage you can offer your employees. And the more employees you add, the less expensive the premiums are per person. Employees also pay little or nothing for premiums.
- Simplicity. With a few exceptions, one plan covers everyone on your team, anywhere in the world. Your employees also usually won’t have to go through complex medical exams to get approved. Instead, everyone gets the same level of coverage. And with a simple lump-sum payout, there’s not a lot of fuss if the worst happens. You can truly “set it and forget it.”
- Portability. A group insurance policy will protect your employees abroad where individual policies from their home countries may not. And if their assignments take them to a third country, they’re likely to still be covered!
Also Read: How Can an International PEO Help
How Much Should My Employee Life Insurance Be?
International group life insurance plans tend to pay out a lump sum amount several times an employee’s salary. For example, William Russell’s life insurance for employees abroad pays five times the salary, with a cap of $2 million USD. Some plans offer higher payouts, and you can add riders and other individual benefits a la carte.
For your employees, the costs of group life insurance should be minimal, or even zero. A group plan is less expensive for the company providing it, because the multiple policies bundled together allow for a discount. Because of this, your employees will either pay no additional premiums for life insurance, or will pay very little.
How Many Employees Do You Need for Group Life Insurance?
For most group term life or group universal life insurance plans, you need three or more employees. Individual business owners or partners (where there are only two) can’t take advantage of group insurance. You can purchase international group life insurance for small businesses, as long as you have at least three people to be covered. And remember: the more employees you cover, the deeper the discount.
Group International Life Insurance Options
Here at International Citizens Insurance, we offer several great group life insurance plans from trusted companies. Each plan has its own unique benefits and ways to customize your plan to fit your organization’s specific needs. We are here to guide you through the process and help to review new or existing plans.
List of Group Life Insurance Benefits
Different plans will offer subtly different benefits, but here are some of the usual characteristics of employer life insurance for international groups:
- Lump sum payout equivalent to several times the deceased employee’s salary, up to a certain cap
- Ability to set up coverage in one of a variety of currencies for your convenience
- Terminal illness coverage, to protect an employee’s family in the case of diagnosis of an illness very likely to result in death
- Ability to add additional coverage for short- or long-term disability
- Additional coverage for accidental death, critical illness, or permanent disability
Frequent Limitations and Exceptions
While group international life insurance companies provide simple and flexible coverage for your workers, there are some exceptions for most plans. These include death resulting from:
- A pre-existing condition
- Negligent or illegal activity
- Alcohol or drug abuse
- War or terrorism in countries with government advisories against all travel
It’s also necessary to report a death to your insurer within 12 months in order to receive the benefit.
Some Examples of International Group Term Life Insurance Plans We Offer
The best way to find the right international group life insurance plan for you and your teams is to contact our licensed insurance brokers, who can help you customize a plan that’s right for your group size, destinations and budget. If you want to do more research yourself beforehand, take a look at our pages for two of our major insurers below.
William Russell International Group Life Insurance Policy
A William Russell Life Insurance plan is an international life insurance plan that covers you no matter where you are in the world. If something happens while you are abroad, with the ability to insure your life for up to $2 million, you can be assured that your family will be financially secure after you are gone. You can set up your plan in U.S. dollars, UK pounds, Euro, and UAE dirhams in order to make access easier.
Unisure Global Group Life Insurance
Unisure is a global insurance company featuring plans that provide worldwide coverage for health and life insurance. The Unisure Group provides global solutions for individuals, families, and businesses for their health and life insurance needs. Unisure has the ability to build out a custom group plan with a wide range of benefits available, including group life insurance and accidental death.
- Insurance for Corporations and Employee Groups
- International Group Medical, Life, and Travel Insurance
- Global Group Medical Insurance Plans
Author: Andrew Blomberg is the Vice President of Global Benefits at International Citizens Insurance. Andrew is a licensed insurance broker with expertise in the areas of international travel, global health, life, and disability insurance. Having worked and traveled throughout the world, he has the experience to provide personal insight along with his industry knowledge. Andrew is dedicated to providing group benefits to organizations, large and small, for today's global workforce. Connect with him on LinkedIN.