Life and Disability Insurance for Employees

Life and disability insurance benefit makes a business attractive to potential employees. What more, it could help a business survive the death or disability of a key person. Find out how you could subscribe to this insurance, what factors you have to consider when deciding to get one, and how you could make an informed decision.

One benefit that a business could provide its employees is life and disability insurance.

Such insurance, like health care insurance, makes companies attractive to people looking for jobs, and could help them retain the best lineup of employees. Having a life and disability insurance, especially for key employees, helps ensures that the business survives upon the death or the loss of the key person's ability to work for the business. Replacing a director, a chief financial officer, or person with an important function in the business requires funding. While this could be sourced from other means, a life insurance is a sure way to have such needed financing. Also, life insurance for key employees could help the business in some of its transactions. Some banks require key employee insurance protection for certain loan agreements.

Life Insurance for Employees

If you are a business with a significant number of employees, you might want to provide life and disability benefit to your workers. For a group to be enrolled in a one policy, the members must reach a certain number, usually about 10. The more the members there are, the lower the premium could get. Life insurance rates also depend on the company's claim history, its nature of business, the gender and average age of employees, among others. When purchasing a policy, you should determine how much you are willing to pay, whether you should spend for the entire amount, whether your employees would want additional coverage, and whether they are willing to shoulder part of the premium. Also, will you have a term insurance, one whose benefits can be claimed only when death occurs while the term of the policy is effective? Or whole life insurance, which runs for the duration of premium payment.

Disability Insurance for Employees

Aside from death, you could also insure your employees against disability both temporary and long term. Check on the regulations of your state whether you are required by law to provide short-term disability insurance. As an added benefit, you can provide long-term disability insurance that would continue even for the rest of the life of the insured. If your state requires short-term disability benefit, you can make the long-term disability insurance optional.

There are several types of disability insurance and it is wise to determine the appropriate level of protection your employees should have. For advice on the right insurance for your needs, consult an insurance broker. Brokers are independent, unlike insurance agents, and can lead you to many possible insurers. Resources to see: Independent Insurance Agents and Brokers of America and National Association of Professional Insurance Agents.


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