Group life insurance policies are generally written as which type?

Group life insurance policies are primarily structured as annually renewable term insurance because this format allows for coverage that can be renewed each year without requiring individuals to demonstrate insurability. This is advantageous for both the insurer and the insured. It simplifies administration for the insurance company, as it does not require individual underwriting every year, and it offers businesses a convenient way to provide life insurance coverage for their employees.

The annually renewable term nature ensures that premiums are generally lower, especially for large groups, since the risks are spread across many participants. It provides straightforward coverage that can easily adapt to changes in group membership, making it an efficient option for employers looking to offer affordable life insurance benefits.

While term riders and increasing term policies can also provide specific benefits, they are not the standard approach for group insurance. Group whole life, on the other hand, includes a savings component and is less common for group coverage due to higher costs and complexities. Therefore, the foundation of group life insurance policies being primarily annually renewable term aligns with common practices in the industry.