Compare a flat death benefit with a multiple of salary, including the definition of eligible earnings and any overall limit. Ask which amounts are guaranteed issue, when evidence of insurability is required, and whether late enrollment or an increase triggers medical underwriting. Guaranteed issue does not mean every employee can enroll at any time without conditions.
Read age-based benefit reductions and exclusions. Portability may let an employee continue group coverage; conversion may let the employee obtain an individual policy. Availability, deadlines, pricing and policy type depend on the contract, so confirm what happens at termination or retirement.
Under Internal Revenue Code Section 79, the cost of employer-provided group-term life coverage above ,000 generally creates taxable imputed income under IRS rules; it is not the entire death benefit that becomes wages. Exceptions and special rules can apply. Review payroll reporting using IRS group-term life insurance guidance.
Coordinate voluntary worksite benefits with your group health insurance options.