Life Insurance
A popular benefit that many companies offer their employees is Group Life Insurance.
This type of insurance can be low- or no-cost to the employee, providing financial support to their families and loved ones after they are gone. These death benefits can be based on employee salary, or can be a pre-set amount.
Generally, group life insurance is term life insurance, which means that the insured is covered until a set age (usually 65), and then the policy expires. If the employee dies after this age, there is no benefit payable to the beneficiaries.
Some group life insurance plans include additional benefits as well. An accidental death and dismemberment provision provides payment in the event that the insured is in a covered accident that causes death or specific serious injuries (blindness, loss of a limb, etc.). An accelerated death benefit allows a terminally ill insured to access funds from their group life insurance plan in order to pay for costly end-of-life care.
Another benefit some companies may offer their employees is the ability to add additional insurance per their own needs. Voluntary life insurance is generally paid for by the employee, not the employer, but the cost is markedly less expensive than it would be if seeking it on an individual basis. Another benefit is that, generally, an employee would not have to prove their insurability to the insurer, resulting in less stringent requirements for obtaining additional coverage.
Upon termination of employment, most group life policies include a conversion clause, wherein employees can keep their group life insurance even after they’ve left the company, paying premiums themselves (though the cost may increase somewhat).
When seeking a suitable life insurance policy to offer your employees, it can be daunting to consider the many different options that are available.