Why Life Insurance Makes Your Worksite Portfolio Pop

Some products offer unique and flexible features like generous guarantee issue amounts, portability, and plan options.

By Judy Buczek

Companies that offer life insurance stand out because they provide support for employees’ families through the toughest of situations. Fifty-seven percent of life insurance policyholders obtain their policy exclusively through their workplace, meaning benefits consultants can offer companies a unique asset to benefits plans that will increase employee satisfaction and happiness.*

As workplace benefits evolve and employees increasingly gather policies from outside sources, employers can wisely offer life insurance as an asset to supplement an existing life insurance plan. Certain policies, such as voluntary life programs, offer unique and flexible financial features, such as:

• Generous Guarantee Issue Amounts —This helps employees take advantage of coverage opportunities, regardless of health history, which, in other cases, might raise their premium.

• Portability —This feature is a plus for employees should they change jobs, as it ensures they maintain financial protection. Employers should be aware that an employee-paid plan most likely includes portability to maximize flexibility and increase the product’s appeal.

• Plan Options —Added features like LifeAssist provide critical income to employees who suffer a severe or catastrophic disability while on an approved waiver of premium.

• Easy Enrollment—Education about the product is critical to helping employees understand how to get the best coverage for their family and how it helps overall financial wellness.

Another positive factor is that employees appreciate the “one-stop-shop” approach for finding health benefits, voluntary benefits and wellness programs all in one place. As more and more companies implement financial wellness initiatives, employees are getting more exposed to the benefits of purchasing life insurance through work or through an advisor.

However, for many middle-income families who don’t have access to a financial advisor, the workplace may be the only place to obtain life insurance, gaining financial security through their employer. Finally, the enrollment process and the fact that they don’t need a medical exam to obtain coverage if they get a policy through work are also a plus.

Offering an array of employee benefits, like life insurance, can have a positive effect on employee productivity and satisfaction. High financial stress impacts working Americans’ emotional and physical well-being— Guardian’s Workplace Benefits Study reveals that financial-related stress can distract people, affect progress at work and take a physical toll that impacts a company’s health-related costs.*

Offering employee benefits like life insurance can have a positive effect on employee productivity and satisfaction.

The same study indicates that the leading cause of stress for American workers is their financial situation; yet, one in four working Americans does not have life insurance—a valuable resource that could provide long-term benefits and peace of mind.*

Employers often choose to offer life insurance up to a specific amount, such as double an employee’s salary or a maximum of $100,000. Frequently, this amount does not cover a family’s expenses should the policy go into effect, leaving their family in a stressful financial situation.

To increase protection for employees, employers can forgo setting a specific amount of coverage. If this isn’t an option, employers can play a role in helping educate employees about financial basics and the various types of products that exist to boost one’s financial security. Benefits consultants can reach out to employers about further rounding out their financial package with additional products, such as hospital indemnity insurance or critical illness.

Implementing life insurance into packages

Workers need to be prompted to think about current and upcoming life events and assess their own financial wellness to determine what protection products will provide their families with financial security. However, many employees find the enrollment process confusing and find it hard to access information about their benefits.

To overcome this challenge, benefits consultants should recommend a benefits communication plan that uses a combination of approaches throughout the enrollment process. Decision support tools, emails, in-person presentations, videos and online enrollment are all important education channels that can help employees make the right benefits choices.

Employers can provide their employees with valuable resources to gain a better understanding of the financial benefits of life insurance, as well as how it can impact their overall well-being. In the long run, employers will turn to benefits consultants who provide plans to keep their employees happy and healthy.

References

* The Guardian Workplace Benefit Study, 4th Annual, “Mind, Body, and Wallet”

Judy Buczek is Director of Group Products, Life and Disability, at Guardian.