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GROUP TERM LIFE INSURANCE:
DEFINITION, COVERAGE, BENEFITS, COST,  CLAIMS

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What is group term life insurance, how does it differ from individual term life?

Group term life policy is a life insurance policy provided by an employer or organization to a group of people, typically employees, under a single master contract. It offers death benefit coverage for a specified term (often one year, renewable annually).​

Individual term life insurance is a policy purchased directly by an individual from an insurer for a fixed term (e.g., 10, 20, or 30 years). It provides a death benefit to beneficiaries if the policyholder dies during the term.

  • Provider

    • Group Term Life Insurance: Employer or organization under a master contract; Individual Term Life Insurance: Purchased directly by the individual

  • Eligibility

    • Group Term Life Insurance: Employees/members of a group (e.g., 10+ people); Individual Term Life Insurance: Any individual meeting insurer’s criteria

  • Underwriting

    • Group Term Life Insurance: Minimal/no medical exams for basic coverage; Individual Term Life Insurance: Requires health assessment/medical underwriting

  • Cost

    • Group Term Life Insurance: Lower premiums due to group risk pooling; Individual Term Life Insurance: Higher premiums based on individual risk

  • Portability

    • Group Term Life Insurance: Typically ends upon leaving employer; Individual Term Life Insurance: Fully portable, remains active if premiums are paid

  • Coverage Amount

    • Group Term Life Insurance: Often tied to salary (e.g., 1-3x annual salary); Individual Term Life Insurance: Chosen by individual, can be higher or lower

  • Customization

    • Group Term Life Insurance: Limited; set by employer/insurer; Individual Term Life Insurance: Highly customizable (term, amount, riders)

  • Premium Funding

    • Group Term Life Insurance: Often employer-paid or shared; Individual Term Life Insurance: Paid by individual with after-tax income

  • Tax Implications

    • Group Term Life Insurance: Employer-paid premiums for basic coverage not taxable; Individual Term Life Insurance: No tax deductions for premiums; benefits tax-free

  • Renewal

    • Group Term Life Insurance: Annually renewable by employer; Individual Term Life Insurance: Fixed term (e.g., 10-30 years) chosen at purchase

Who is typically eligible to enroll in a group term life insurance plan?

In Hong Kong, eligibility for group term life insurance plans typically includes:

  1. Full-Time Employees: Most commonly, permanent full-time employees of a company offering the plan are eligible. This is the primary group targeted by employers providing group term life insurance as part of employee benefits.

  2. Part-Time Employees (in some cases): Some employers extend coverage to part-time employees, though this may depend on minimum working hours (e.g., 20 hours per week) or specific company policies.

  3. Members of an Organization: For non-employer groups (e.g., professional associations or trade unions), members in good standing are typically eligible. In Hong Kong, such groups are less common but exist for certain industries.

  4. Minimum Group Size: Insurers in Hong Kong often require a minimum group size (e.g., 10 or more employees/members) to qualify for a group plan, ensuring risk pooling.

  5. Age Requirements: Employees or members within a specified age range (typically 18 to 65) are eligible, though some plans extend coverage to age 70 or allow retirees to convert to individual policies.

  6. Active Employment Status: Eligibility usually requires active employment at the time of enrollment. New hires may need to complete a probationary period (e.g., 3 months) before joining, depending on the employer’s policy.

What are the primary benefits of group term life insurance for employees?

The primary benefits of group term life insurance for employees in Hong Kong include:

  1. Cost-Effective Coverage: Premiums are typically lower than individual term life insurance due to group risk pooling. 

  2. No Medical Underwriting for Basic Coverage: Employees can enroll in basic coverage without health checks or questionnaires, making it accessible even for those with pre-existing medical conditions, a significant advantage in Hong Kong’s fast-paced workforce.

  3. Financial Security for Beneficiaries: Provides a tax-free death benefit (often 1-3 times annual salary) to beneficiaries, helping cover funeral costs, debts, or living expenses.

  4. Ease of Enrollment: The enrollment process is simple, often automatic upon joining an employer, with minimal paperwork, saving time for employees.

  5. Optional Dependent Coverage: Many group plans allow employees to extend coverage to spouses and children, offering family-wide protection under a single policy.

  6. Integration with Employee Benefits: Enhances overall benefits packages, complementing mandatory schemes, making employers more attractive in competitive job market.

  7. Tax Advantages: Under Hong Kong’s Inland Revenue Ordinance, employer-paid premiums for basic coverage are not treated as taxable fringe benefits, and death benefits are tax-free for beneficiaries.

  8. Supplemental Coverage Options: Employees can often purchase additional coverage (e.g., critical illness or accidental death riders) at group rates, which are typically cheaper than individual policies.

  9. Peace of Mind: Offers reassurance that loved ones are financially protected, particularly valuable in Hong Kong where living costs and housing expenses are among the highest globally.

What is the typical coverage amount (sum insured) for basic group term life insurance?

In Hong Kong, the typical coverage amount (sum insured) for basic group term life insurance is usually 1 to 3 times the employee’s annual salary. This range is common across many employers and industries. However, the exact amount varies based on the employer’s policy, the insurer, and the group’s risk profile.

  • Common Range: Coverage is often set at 1x, 2x, or 3x the employee’s annual base salary. 

  • Flat Amounts: Some plans, especially for smaller firms or lower-wage employees, offer a fixed sum insured (e.g., HKD 500,000 or HKD 1 million) instead of a salary multiple to simplify administration.

  • Industry Differences: High-paying industries like banking may offer higher multiples (2x–3x), while retail or hospitality sectors might provide lower coverage (1x or a flat amount).

  • Dependent Coverage: If dependents are included, coverage for spouses is typically 50%–100% of the employee’s sum insured, and for children, it’s often a smaller fixed amount (e.g., HKD 100,000–200,000).

  • Insurer Practices: Major Hong Kong insurers structure basic coverage to balance affordability for employers and meaningful benefits for employees, with no medical underwriting required for these amounts.

Can employees increase coverage beyond the standard amount offered in a group plan?

Yes, employees in Hong Kong can often increase coverage beyond the standard amount offered in a group term life insurance plan through supplemental or voluntary coverage options, subject to certain conditions. Key Details on Increasing Coverage:

  • Supplemental Coverage Availability:

    • Many Hong Kong employers offer employees the option to purchase additional coverage beyond the basic sum insured (typically 1–3 times annual salary).

    • This is often called voluntary group term life insurance or optional coverage, allowing employees to increase the death benefit or add riders like critical illness or accidental death benefits.

  • How It Works:

    • Employees can elect higher coverage amounts during open enrollment periods or upon specific life events (e.g., marriage, childbirth), as defined by the plan.

    • The additional coverage is usually a multiple of the base salary (e.g., up to 5x or 10x, depending on the plan) or a fixed amount (e.g., increments of HKD 500,000).

  • Dependent Coverage:

    • Employees may also increase coverage for dependents (spouses or children), if the plan allows, often with similar requirements for evidence of insurability for higher amounts.

What additional riders, such as critical illness, are commonly added to group term life?

Group term life insurance plans often allow employees to add riders to enhance coverage beyond the basic death benefit. These riders provide additional financial protection for specific events or conditions. Commonly Added Riders:

  • Critical Illness Rider:

    • Description: Pays a lump-sum benefit if the insured is diagnosed with a covered critical illness (e.g., cancer, heart attack, stroke, kidney failure) as defined by the policy.

    • Coverage: Typically ranges from HKD 100,000 to HKD 1 million, depending on the plan, and may be a percentage of the life insurance sum insured.

    • Popularity: Highly sought after in Hong Kong due to rising healthcare costs and the prevalence of stress-related illnesses in urban settings.

    • Conditions: Requires evidence of insurability for higher coverage amounts. The list of covered illnesses varies but often includes 30–50 conditions, aligned with Hong Kong’s medical insurance standards.

  • Accidental Death and Dismemberment (AD&D) Rider:

    • Description: Provides an additional payout if the insured dies or suffers severe injury (e.g., loss of limb, sight, or hearing) due to an accident.

    • Coverage: Often matches or doubles the basic life insurance sum insured (e.g., HKD 1–3 million for a 2x salary base plan).

    • Relevance: Popular in industries with higher physical risks (e.g., construction, logistics) or for employees seeking extra protection for unforeseen accidents.

  • Total and Permanent Disability (TPD) Rider:

    • Description: Pays a benefit if the insured becomes permanently disabled and unable to work, helping cover lost income or medical expenses.

    • Coverage: May be a lump sum or a percentage of the life insurance amount, often capped at HKD 1–2 million.

    • Context: Valued in Hong Kong, where long-term disability can strain finances due to high living costs.

  • Dependent Life Rider:

    • Description: Extends life insurance coverage to the employee’s spouse or children, paying a benefit upon their death.

    • Coverage: Typically lower than the employee’s coverage (e.g., HKD 100,000–500,000 for spouses, HKD 50,000–200,000 for children).

    • Appeal: Attractive for employees prioritizing family protection, a cultural priority in Hong Kong.

  • Hospitalization or Medical Expense Rider:

    • Description: Covers hospital stays or medical costs related to specific conditions, supplementing private medical insurance.

    • Coverage: Varies widely, often providing daily hospital cash (e.g., HKD 1,000/day) or reimbursement for treatments.

    • Use Case: Common in Hong Kong, where private healthcare costs can be significant, and employees seek comprehensive benefits.

  • Waiver of Premium Rider:

    • Description: Waives future premiums if the insured becomes disabled or unable to work, keeping the policy active without additional cost.

    • Benefit: Ensures coverage continues during financial hardship, a practical feature in Hong Kong’s expensive economy.

How are premiums for group term life calculated, what factors affect the cost?

Premiums for group term life insurance are calculated based on the collective risk profile of the insured group, rather than individual characteristics, which distinguishes it from individual term life insurance. How Premiums Are Calculated:

  • Group Risk Assessment:

    • Insurers assess the overall risk of the group based on aggregated data, such as the average age, gender distribution, and occupational hazards of employees or members.

    • No medical underwriting is typically required for basic coverage, which simplifies the process and keeps costs lower than individual policies.

  • Sum Insured:

    • The premium is tied to the coverage amount (sum insured), often set as a multiple of annual salary (e.g., 1x–3x) or a fixed amount (e.g., HKD 500,000–1 million).

    • Higher coverage amounts result in higher premiums, but group rates ensure economies of scale.

  • Premium Rate per Unit of Coverage:

    • Insurers apply a rate (e.g., HKD per HKD 1,000 of coverage) based on the group’s risk profile. 

    • Rates are adjusted annually during policy renewal, reflecting claims experience and updated group demographics.

  • Funding Structure:

    • Premiums may be fully employer-paid, fully employee-paid, or shared, depending on the plan.

    • For supplemental coverage or riders (e.g., critical illness), employees typically pay additional premiums via payroll deductions.

  • Administrative Costs:

    • Insurers include administrative fees in the premium calculation to cover policy management, claims processing.

Key Factors Affecting Premium Costs

  1. Group Size:

    • Larger groups (e.g., 50+ employees) typically enjoy lower premiums due to risk diversification. Smaller groups (e.g., 10–20 employees) may face higher rates because of limited risk pooling.

    • Hong Kong insurers often require a minimum of 10 members to qualify for a group plan.

  2. Average Age of the Group:

    • Older groups have higher premiums due to increased mortality risk. 

    • Age bands (e.g., 25–34, 35–44) may be used to adjust rates within the group.

  3. Gender Distribution:

    • While less impactful than age, gender can influence premiums, as women statistically have longer life expectancies. However, Hong Kong insurers often use unisex rates for simplicity in group plans.

  4. Industry and Occupational Risk:

    • High-risk industries (e.g., construction, logistics) face higher premiums due to increased likelihood of accidents or claims. In contrast, low-risk sectors like finance or technology benefit from lower rates.

    • For example, a Hong Kong construction firm might pay higher premiums than a corporate office due to workplace hazards.

  5. Claims Experience:

    • The group’s historical claims data (experience rating) affects renewal premiums. A group with frequent claims may see higher rates, while a low-claims group may benefit from discounts.

    • Insurers review claims annually to adjust pricing.

  6. Coverage Amount and Riders:

    • Higher sums insured or additional riders (e.g., critical illness, accidental death) increase premiums. 

    • Dependent coverage (spouses, children) also raises costs.

  7. Policy Terms and Renewal Frequency:

    • Most group plans in Hong Kong are annually renewable, with premiums adjusted based on updated group data or market conditions.

    • Longer-term commitments or multi-year contracts may secure lower rates.

  8. Insurer and Market Competition:

    • Hong Kong’s competitive insurance market drives cost efficiency. Insurers may offer discounts to attract large corporate clients.

    • Administrative efficiency and the insurer’s financial strength also influence pricing.

Is group term life portable for employees who change jobs or retired in Hong Kong?

In Hong Kong, group term life insurance is generally not portable for employees who change jobs or retire, as it is tied to the employer’s master contract with the insurer. However, there are specific provisions and options that may allow limited portability or conversion under certain conditions, depending on the policy terms and insurer practices.

  • Standard Non-Portability:

    • Group term life insurance is typically linked to employment with a specific employer. When an employee leaves their job (e.g., resigns, is terminated, or switches employers), coverage under the group plan usually terminates shortly after departure, often within 30–60 days, as specified in the policy.

    • This is because the employer negotiates and funds (fully or partially) the plan, and the insurer underwrites it based on the group’s collective risk profile.

  • Conversion Options:

    • Some Hong Kong group plans allow employees to convert their group coverage to an individual term life insurance policy with the same insurer upon leaving the employer.

    • Process: The employee must apply within a grace period (typically 30–90 days after leaving) and may need to provide evidence of insurability (e.g., health questionnaire or medical exam).

    • Cost: Converted individual policies are more expensive, as they lose the group discount and are based on the employee’s individual risk profile (age, health, etc.).

    • Limitations: Conversion may be restricted to specific policy types offered by the insurer, and the coverage amount or terms may differ from the group plan.

Portability Upon Retirement

  • Termination of Coverage:

    • Upon retirement, group term life insurance typically ends, as coverage is tied to active employment. The policy’s master contract usually excludes retirees unless explicitly stated otherwise.

    • Some Hong Kong employers provide a short grace period (e.g., 30 days) post-retirement during which coverage may remain active.

  • Conversion to Individual Policy:

    • Similar to job changes, some group plans allow retirees to convert their coverage to an individual policy with the same insurer.

    • Requirements: Evidence of insurability is often required, which can be a barrier for retirees, especially older individuals or those with health issues.

    • Cost Implications: Premiums for converted policies are significantly higher due to the retiree’s age and health status, making this option less affordable in Hong Kong’s market.

  • Retiree-Specific Plans:

    • A few Hong Kong employers, particularly large corporations or multinationals, may offer retiree group life plans as part of a comprehensive benefits package. These are rare and typically limited to long-serving employees or senior executives.

    • Such plans may provide reduced coverage at a subsidized rate, but they are not standard practice.

Are death benefits from group term life insurance taxable in Hong Kong?

Death benefits from group term life insurance are generally not taxable for beneficiaries under the Inland Revenue Ordinance (IRO). This applies to the lump-sum payout received upon the insured employee’s death, whether paid to the employee’s estate or designated beneficiaries (e.g., spouse, children). Tax Treatment of Death Benefits:

  • Tax-Free Death Benefits:

    • Under Hong Kong’s tax laws, life insurance proceeds, including death benefits from group term life insurance, are not considered taxable income for beneficiaries. This is because such payouts are treated as capital receipts, not income, per Section 14 of the IRO, which governs assessable income.

    • This applies regardless of whether the policy is fully employer-funded, partially employee-funded, or includes supplemental coverage.

  • No Estate Duty:

    • Hong Kong abolished estate duty (inheritance tax) in 2006 under the Revenue (Abolition of Estate Duty) Ordinance. As a result, death benefits from group term life insurance are not subject to estate or inheritance taxes, ensuring beneficiaries receive the full payout without deductions.

  • Exceptions and Caveats:

    • If the death benefit is paid to the deceased employee’s estate and becomes part of probate, administrative costs or legal fees (e.g., for estate settlement) may reduce the net amount received by beneficiaries, but these are not taxes.

    • If the beneficiary is a non-resident of Hong Kong and the payout is processed through a foreign jurisdiction, local tax laws in that jurisdiction might apply. However, this is rare, as most group plans in Hong Kong are paid to local beneficiaries.

Are employer-paid premiums for group term life considered a taxable fringe benefit?

In Hong Kong, employer-paid premiums for group term life insurance are generally not considered a taxable fringe benefit for employees under the Inland Revenue Ordinance (IRO). Tax Treatment of Employer-Paid Premiums:

  • Non-Taxable Fringe Benefit:

    • Under Section 9 of the IRO, which defines taxable income from employment, employer-paid premiums for group term life insurance are typically exempt from being treated as a taxable fringe benefit. This is because such premiums are not considered a direct personal gain or "advantage" to the employee, unlike benefits like housing allowances or company cars.

    • The Inland Revenue Department (IRD) views these premiums as part of the employer’s group benefit structure, provided for the collective welfare of employees, rather than a personal taxable benefit.

  • Conditions for Exemption:

    • The exemption applies to basic coverage provided under the group term life insurance plan, where the employer pays premiums for all eligible employees as part of a standard benefits package.

    • The coverage must be part of a group policy (e.g., with insurers like AIA, Manulife, or HSBC Life) and not tailored to individual employees as a special perk.

  • Contrast with Other Jurisdictions:

    • Unlike some countries (e.g., the U.S., where employer-paid premiums for group term life coverage exceeding USD 50,000 are taxable), Hong Kong does not impose a similar threshold or tax liability on employer-paid premiums, regardless of the coverage amount.

  • Supplemental Coverage:

    • If employees opt for supplemental coverage (e.g., higher sums insured or riders like critical illness) and pay premiums themselves via payroll deductions, these contributions are made with after-tax income and are not tax-deductible. However, employer-paid portions of supplemental coverage, if any, remain non-taxable as long as they are part of the group plan structure.

Employers can deduct the cost of group term life insurance premiums as a business expense under Section 16 of the IRO, provided the plan is part of a legitimate employee benefits program. The death benefits paid to beneficiaries from group term life insurance are tax-free under Hong Kong’s IRO, and the non-taxable nature of employer-paid premiums further enhances the tax efficiency of these plans.

What is evidence of insurability,when is it required for higher coverage in group plans?

Evidence of Insurability (EOI) refers to documentation or information that an insurance provider requires to assess an individual’s health, lifestyle, and risk factors before approving coverage or additional benefits. In the context of group term life insurance in Hong Kong, EOI typically involves a health questionnaire, medical examination, or other health-related disclosures to determine the applicant’s insurability. Common EOI Components:

  • Health Questionnaire: Questions about medical history, current health conditions, family medical history, and lifestyle factors (e.g., smoking, alcohol use, or hazardous activities).

  • Medical Examination: May include blood tests, blood pressure checks, or other diagnostic tests, conducted by a designated medical professional.

  • Lifestyle Information: Details about occupation, hobbies (e.g., extreme sports), or travel to high-risk areas.

  • Financial Underwriting: For very high coverage amounts, insurers may assess whether the sum insured aligns with the individual’s financial needs.

In Hong Kong, group term life insurance plans typically offer basic coverage (e.g., 1–3 times annual salary) without requiring EOI, as the risk is spread across the group and underwritten collectively. However, EOI is often required for higher coverage amounts or additional riders beyond the standard offering. Below are the scenarios when EOI is typically required:

  • Supplemental or Voluntary Coverage:

    • Employees may opt to increase their coverage beyond the basic sum insured (e.g., from 2x salary to 5x salary or a fixed amount like HKD 3 million).

    • EOI Requirement: Insurers require EOI to assess the additional risk, as higher coverage increases their potential liability. 

    • Process: The employee completes a health questionnaire and, in some cases, undergoes a medical exam. Approval depends on the results, and premiums may be adjusted based on health risks.

  • Addition of Riders:

    • Description: Riders like critical illness, accidental death and dismemberment (AD&D), or total and permanent disability (TPD) often require EOI, especially for significant benefit amounts.

    • EOI Requirement: Since riders cover specific health-related or high-risk events, insurers need to evaluate the employee’s health or lifestyle. For instance, a critical illness rider covering HKD 500,000 may require a questionnaire detailing medical history or a medical check for conditions like cancer or heart disease.

  • Coverage Above Guaranteed Issue Limit:

    • Many group plans in Hong Kong have a guaranteed issue limit, which is the maximum coverage amount offered without EOI (e.g., HKD 1–2 million or 3x salary). Coverage exceeding this limit requires EOI.

    • EOI Requirement: If an employee requests a sum insured beyond the guaranteed issue limit, the insurer assesses their health to mitigate risk. 

    • Context: Guaranteed issue limits vary by insurer and group size, with larger groups often having higher limits due to risk diversification.

  • Dependent Coverage:

    • If employees opt to cover dependents (spouses or children) beyond a minimal amount, EOI may be required for the dependents.

    • EOI Requirement: For example, adding a spouse with HKD 500,000 coverage might require the spouse to submit a health questionnaire, especially if the amount exceeds the plan’s standard dependent coverage (e.g., HKD 100,000–200,000).

  • Conversion to Individual Policy:

    • When an employee leaves their job or retires and seeks to convert their group coverage to an individual policy, EOI is often required.

    • EOI Requirement: The insurer evaluates the employee’s health to set premiums for the individual policy, as the group’s risk pooling no longer applies. 

  • Special Circumstances:

    • Late Enrollment: If an employee joins the group plan outside the initial enrollment period (e.g., after the probationary period or during a special enrollment), EOI may be required, even for basic coverage.

    • High-Risk Occupations: Employees in high-risk roles (e.g., construction workers) may face EOI requirements for higher coverage, depending on the plan.

    • Age Limits: Older employees (e.g., above 50 or 55) may need EOI for supplemental coverage due to increased mortality risk.

How do group term life plans handle pre-existing medical conditions for new enrollees?

In Hong Kong, group term life insurance plans handle pre-existing medical conditions (PECs) very favorably for new enrollees—especially for basic coverage—due to the group underwriting model.

1. Basic Coverage (Guaranteed Issue) – NO Medical Underwriting

  • No health questions or medical exams required for the standard employer-provided coverage (typically 1–3x annual salary).

  • Pre-existing conditions are FULLY COVERED from Day 1 of enrollment.

  • The insurer spreads risk across the entire group (e.g., 10–1,000+ employees), so individual health issues don’t affect eligibility or pricing for basic coverage.

2. Supplemental / Voluntary Coverage – EOI Usually Required

  • When employees want higher coverage (e.g., 4x–10x salary) or riders (critical illness, TPD), insurers apply individual underwriting. 

  • Adding 2x extra life cover (e.g., total 5x salary): EOI Required

    • PECs may lead to: → Decline, exclusion, or premium loading

  • Critical illness rider: EOI Required

    • Most PECs excluded (e.g., no payout for cancer if diagnosed in past 5 years)

  • Accidental death rider: Usually EOI is not required

    • PECs generally not relevant (accident-only)

  • Common PEC Exclusions in Riders:

    • Cancer: 5-year lookback

    • Heart disease/stroke: 2–5 years

    • Diabetes: May be accepted with loading or partial coverage

New enrollees under the PEC policy receive basic coverage with 100% guarantee during open enrollment, but late entrants may need to provide Evidence of Insurability (EOI) even for basic coverage. Coverage typically begins after a 1-3 month probation period, although PECs remain covered once activated; those aged over 55 or seeking high coverage may face EOI requirements even for minor increases.

What common exclusions or limitations apply to group term life insurance policies?

Below is a practical, Hong Kong-specific summary of the most common exclusions and limitations in group term life insurance policies:

  • Standard Exclusions (Death Benefit): Applies to basic life coverage (1–3x salary)

    • Suicide within first 12–24 months: No payout if death by suicide in the contestability period (usually 1–2 years from enrollment or coverage increase). After that, full benefit paid.

    • War, terrorism, civil unrest: Death due to declared/undeclared war, riots, or acts of terrorism (common in policies post-2019 protests).Criminal actsDeath while committing or participating in a felony (e.g., drug trafficking, robbery).

    • Dangerous activities: Skydiving, motor racing, scuba >40m, mountaineering with ropes — unless disclosed and accepted.Aviation (non-commercial)Death as pilot/crew of private aircraft (commercial flights are covered).
      Alcohol/drug-related death: If blood alcohol > legal limit or death due to illegal drug use.

  • Critical Illness / TPD Rider Exclusions (if added)

    • Pre-existing conditions: 2–5 years (e.g., cancer diagnosed in last 5 years → no payout)

    • HIV/AIDS: Always excluded (unless occupational exposure)

    • Self-inflicted injury: No payout for intentional harm

    • Congenital conditions: Excluded if diagnosed after policy start

    • ​Waiting period: 90 days from rider start for most illnesses (except accidents)

  • Coverage Limitations (Not Exclusions, But Caps)

    • Maximum sum insured: 5x–10x salary or HKD 5–10M (whichever lower) — even with voluntary top-up

    • Age limit: Coverage ends at age 65 or 70 (some extend to 75 with reduced benefit)

    • Dependent coverage: Spouse: max 50–100% of employee; Child: HKD 100K–250K flat

    • Guaranteed issue limit: HKD 1–2M or 3x salary without EOI; above this → medical underwriting

    • Portability: No automatic continuation after job exit or retirement (conversion option may be limited/expensive)

  • Operational / Administrative Limitations

    • Late enrollment: New hires who miss open enrollment may need EOI even for basic coverage

    • Probation period: Coverage often starts after 1–3 months of serviceJob change / layoffCoverage ends 30–60 days after last workday

    • Part-time / contract staff: May be excluded or get reduced multiple (e.g., 1x instead of 2x)

    • Overseas assignment: Coverage may be suspended if posted >12 months outside HK

What is the process for filing a death benefit claim under a group term life policy?

Below is a step-by-step guide to filing a death benefit claim under a group term life insurance policy in Hong Kong:

  • Notify HR or Employer

    • Responsible: Beneficiary / Family

    • Timing: Within 30–90 days of death (check policy)

    • Required Information:

      • Employee’s name & HKID

      • Date of death

      • Relationship to deceased

  • HR Confirms Coverage & Starts Claim

    • Responsible: HR / Plan Administrator

    • Timing: 1–3 business days

    • HR pulls:

      • Master policy number

      • Employee enrollment record

      • Latest beneficiary form

  • Insurer Sends Claim Pack

    • Responsible: Insurer (via HR or direct)

    • Timing: 2–5 business days

    • Contents: Official Claim Form (pre-filled with policy details)

  • Submit Claim Form + Documents

    • Responsible: Beneficiary

    • Timing: Within 180 days (latest)

    • Core Documents (originals or certified copies):

      1. Death Certificate (issued by HK Death Registry)

      2. Claimant’s HKID / Passport

      3. Proof of Relationship (marriage certificate, birth certificate)

      4. Completed Claim Form (signed)

      5. Beneficiary Designation Form (if on file)

    • If no named beneficiary:

      • Letters of Administration or Grant of Probate

  • Insurer Reviews Claim

    • Responsible: Insurer

    • Timing: 10–30 calendar days

    • May request:

      • Medical reports (if PEC involved)

      • Police report (for accident/suicide)

      • Autopsy (if required)

  • Payout

    • Responsible: Insurer → Beneficiary

    • Timing: 3–7 business days after approval

    • Notes:

      • Direct bank transfer (HKD to local account)

      • 100% tax-free (no IRD deduction)

Are dependents eligible for coverage under group term life insurance plans?

Yes — dependents (spouses and children) are eligible for coverage under most Hong Kong group term life insurance plans, but it is almost always an optional, employee-paid add-on, not automatic. Dependent Coverage:

  • Category: Spouse

    • Eligibility: Legal spouse (HK marriage certificate)

    • Typical Sum Insured: 50%–100% of employee’s basic life (maximum HKD 1–2 million)

    • Funding: Employee-paid

    • EOI Required? Yes, if over HKD 500,000

  • Category: Children

    • Eligibility: Unmarried, dependent, age 15 days–18 (or 23 if full-time student)

    • Typical Sum Insured: Flat HKD 50,000–250,000 per child

    • Funding: Employee-paid

    • EOI Required? Usually No

  • Category: Domestic Partner

    • Eligibility: Not recognized (must be legally married)

    • Typical Sum Insured: Not applicable

    • Funding: Not applicable

    • EOI Required? Not applicable

  • Enrollment Rules:

    • Open Enrollment: Add dependents during annual window or within 30–60 days of marriage/childbirth

    • Late Enrollment: Requires EOI (health questionnaire) for spouse; children usually guaranteed

    • Divorce / Child Ages Out: Coverage auto-terminates; no refund

    • Portability: No — dependent coverage ends when employee leaves job

  • Claim Process for Dependents: Same as employee death claim, but:

    • Spouse claim → paid to employee (as policyholder)

    • Child claim → paid to employee or legal guardian

    • Tax-free in Hong Kong

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Machinery Breakdown

Boiler Pressure Plant

Electronic Equipment

Advance Loss of Profit

Factory and Warehouse

Machinery Loss of Profit

Industrial All Risk

property insurance

group insurance

Group Personal Accident

Group Medical Insurance 

Group Term Life

Group Travel Insurance

Group Disability Insurance

Supplementary Group Medical

Trade Credit

Student Group Insurance

Employee Compensation

Marine & Pecuniary

Marine Cargo Insurance

Marine Open Policy

Protection & Indemnity, P&I

Hull & Machinery Insurance

Inland & Warehouse

Motor Insurance

Fine Art & Jewellers

Yacht & Pleasure Craft

Trade Credit

Bloodstock

Individual Line

Health Insurance

Critical Illness

Home & Contents

Life & Private Medical

Inland & Warehouse

Motor Insurance

Yacht & Pleasure Craft 

Pet Insurance

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