Group Life Assurance Policy or Death-In-Service Benefit Scheme is a contract of insurance designed to provide for the payment of capital sum (sum assured) to the dependants of an employee who dies while in the service of the employer and the event occurring within the period of insurance. It can also be used by various associations who may wish to provide for the dependents of their members in case of death.

Level of Group Life Cover

Group Life Assurance Cover is compulsory on all employees of any establishment with at least three (3) employees and this is to be arranged by the employer in this regard.

Based on the requirement of the Nigerian Pension Reform Act 2014, the minimum cover to be provided by an employer is three (3) times the annual total emolument of the employee - Section 4(5). However for other schemes outside the purview of the Pension Reform Act, such as associations, trade unions and societies, the interested proposers can determine their level of cover based on their discretion. For the purpose of this document, the employer and employee shall also mean the association and members of the association.

Payment of Benefits

Furthermore, the death benefits payable under a Group Life Policy contracted under the provisions of the Pension Reform Act 2014 (as amended) shall be payable in favour of named beneficiary(s) under the policy – Section 8 (1).

Features of Group Life Assurance Scheme

a. The Employer is the policyholder while the Employees are the insured lives.

b. The scheme is arranged to provide benefits in the event of death only.

c. Policy grants cover for both accidental and natural death.

d. Premiums are usually paid by the employer

e. Policy is renewable annually

f. Provides cover on a 24 hours basis

g. Provides Lump Sum benefits for the dependants (named beneficiaries)