What is the primary difference between group life insurance and individual life insurance?

The primary distinction between group life insurance and individual life insurance lies in how the coverage is structured. Group life insurance provides coverage for multiple individuals under a single policy, often arranged by an employer or organization for its members. This means that the policy can cover a large group of people, typically offering a streamlined application process and often without the need for individual medical examinations.

In contrast, individual life insurance is tailored to a single person, where each applicant undergoes their own underwriting process, which typically includes a medical examination. The nature of group life insurance allows it to be more cost-effective and accessible since it distributes risk across a larger pool of individuals.

Understanding this fundamental difference helps elucidate the unique features and benefits that each type of insurance offers. For instance, group life insurance often provides lower premiums and a simpler application process compared to individual policies, which require more detailed assessments of risk and health status.