Group Life Insurance for California Employers
Group life insurance provides a death benefit to the beneficiaries of employees who die while covered by the employer's plan. Basic group term life insurance is typically provided at 1x the employee's annual salary or as a flat benefit amount ($25,000–$50,000). Employer-paid basic life insurance up to $50,000 is a tax-free benefit to the employee — no imputed income for coverage amounts at or below this threshold.
Group life is often paired with Accidental Death and Dismemberment (AD&D) insurance, which pays an additional benefit if the employee dies or suffers a covered injury (loss of limb, sight, etc.) in an accident. AD&D is typically provided at the same face amount as basic life.
Voluntary Supplemental Life
Beyond employer-paid basic life, employees can typically purchase supplemental life insurance at group rates through voluntary payroll deduction. Common options: employee may purchase 1x–5x annual salary (up to $500,000 or carrier guarantee issue amount); spouses can often purchase $10,000–$50,000 coverage; dependent children can be covered for flat amounts ($5,000–$20,000). The "guarantee issue" amount (no medical exam required) ranges from $150,000–$300,000 depending on group size and carrier.
Portability and Conversion Rights
When an employee leaves the company, they typically have the right to port or convert their group life coverage to an individual policy. Portability allows continuation of term coverage at group rates; conversion allows converting to a permanent (whole life) policy regardless of health status. These rights are guaranteed under most group life contracts.
Major Group Life Carriers in California
MetLife, Unum, Sun Life, Lincoln Financial, Principal, and Guardian are the dominant group life carriers in California. Premiums are low — employer-paid basic life at 1x salary typically costs $0.10–$0.25 per $1,000 of coverage per month. A $50,000 benefit costs $5–$12.50/employee/month. Most employers include basic life in their core benefits package at relatively minimal cost.