Understanding IGO in Life Insurance

What IGO Means

In life insurance, IGO stands for Insured Group Option. It is a feature that allows an employer to offer a group life policy to employees with a single policy that covers each member under the same terms.

How IGO Works

The employer purchases the policy and names the employees as insureds. Premiums are typically paid by the employer, though employees may opt to contribute. When a covered employee dies, the designated beneficiary receives a death benefit. Because the policy is pooled, underwriting is simplified and rates are often more favorable than individual policies.

Benefits of an IGO

1. Cost efficiency – Group rates are lower than individual premiums. 2. Administrative simplicity – One policy replaces many. 3. Employee attraction – Adds value to compensation packages. 4. Predictable budgeting – Fixed premiums reduce financial uncertainty.

Choosing the Right IGO

When evaluating an IGO, consider coverage limits, rider options, and the insurer's claims history. Ensure the policy aligns with employee demographics and the company's risk tolerance. A well‑structured IGO can boost employee morale and reduce turnover.

Common Misconceptions

Many think IGO is a type of individual policy. It is not; it is a group arrangement. Others assume it covers all life events, but it typically covers only death benefits unless riders are added.

IGOs vs. Individual Policies