Counting On An Inheritance For Your Retirement? You May Be Disappointed

If you are counting on an inheritance as a critical part of your financial plan, you’d better make sure your parents are on board with the same idea because chances are good that they aren’t.

A recent survey from HSBC Holdings, for example, found that nearly one pre-retiree in four would like to spend all of their savings before they shed their mortal coils. Their children can take care of themselves. Fewer than one retiree in ten stated they wanted to pass on as much wealth as possible to the next generation.

The survey found that, on average, U.S. retirees expected to pass on about $175,000, on average, to their children and grandchildren. Sure, this is a decent sum of money, but it is nowhere near enough to provide anything close to a secure retirement to a married couple that has spent their entire working years neglecting their own retirement saving and planning.

What’s more: Only 56 percent of American retirees surveyed expect to be leaving an inheritance at all.

Inheritance may be under pressure for a variety of reasons – and not just because older Americans simply want to blow the family wealth on Caribbean cruises and casino vacations.


Interest Rates

Low interest rates have been good for younger generations who have been able to get cheap home loans but they have been very tough on older Americans. They have been earning razor thin returns on bank CDs and other forms of saving traditionally popular with risk-averse senior citizens for generations. Twenty years ago, retirees could earn 6-8 percent on CDs. Today, a 5-year CD pays an average yield of 1.66 percent.

So where a $1 million nest egg once generated $70,000 to $100,000 in income per year on minimal risk, the same portfolio now generates income of around $10,000 to $20,000 per year. The difference has to come from somewhere: Seniors are increasingly forced to spend down principal to live on – and that eventually drains inheritances.



Americans are living longer than ever before. One in three of today’s 65-year-old women can expect to live to age ninety. If two 65 year olds are married, there is an 18 percent chance that one of them will live until age 95.

If you don’t take charge of your own retirement, you may well be in the unhappy position of having to borrow money from your parent or parents to pay for a plane ticket to come to their 95th birthday party.

And you may have to take off work.


Long-term care costs 

Increasing long term care costs including adult day care, assisted living facilities, skilled nursing facilities and hospice care are also eating up many older Americans’ nest eggs. According to the 2016 Genworth Cost of Care Survey, the cost of an assisted living facility has gone up to $43,539 per year, while a semi-private room in a long term care facility now costs $82,125 per year, on average, with many areas costing even more.

Medicaid will cover some of these costs, but only after almost all a family’s potential inheritance is used up. If the individual receiving benefits owns a home, state officials may put a lien on the home, reimbursing the state for benefits being paid on the beneficiary’s behalf before sales proceeds are released to heirs.


Reverse Mortgages 

Many seniors have pledged their homes to lenders in exchange for income, essentially borrowing against the equity in their homes in reverse mortgage plans. In many cases, these reverse mortgages are necessary to provide needed income for older Americans to live on but when you inherit the estate, the home may well have to be sold to pay back the reverse mortgage loan. You may not get the inheritance you were planning on.

The responsible course of action is clear: Americans of all generations should take responsibility for their own retirement planning and security. If an inheritance comes it comes, but Americans should not be banking on it. Consuming your entire income is a dangerous plan. Act now to begin saving for your own future, and don’t rely on parental wealth to bail you out.

How Safety Features Affect Front and Rear Crash Rates

Vehicles with front crash prevention are not as likely to cause rear accidents as vehicles that do not have this safety feature. The Insurance Institute for Highway Safety reported this in their study about the effectiveness of the feature, which was based on crash data from police departments.

If systems have automatic braking safety features, they are 40 percent less likely to be in rear accidents. Forward collision systems reduce the likelihood of accidents by almost 25 percent. Although they were not quite as significant in making a difference, automatic brakes also helped reduce crashes and injuries.

Experts cited front crash prevention as a major step toward road safety. They expect to see less of these accidents as the technology continues growing in popularity. Although the technology is growing and becoming prevalent, it is still only offered as an optional feature on most vehicle models. However, this may be changing soon. The National Highway Traffic Safety Administration announced recently that an agreement was in the works with auto manufacturers to make this safety feature a standard inclusion on all vehicle models.

By using police reports for their research, these organizations are able to better identify the causes of front-to-rear crashes and measure the effectiveness of safety features. This is especially true with the front crash prevention system. Researchers used reports from 22 different states for their comprehensive analysis, and several makes of vehicles were included for a more uniform result.

Researchers found that having both a forward collision warning system and automatic brakes reduced the likelihood of a crash by nearly 40 percent. Rear crash likelihood decreased by almost 50 percent with these features when combined with the city safety feature. Experts said that when crashes could not be avoided, automatic brakes still provided a good chance of reducing the amount and severity of injuries by lowering the speed of impact. However, they were still surprised that forward collision warning features did not yield a more significant prevention result.

One of the difficulties faced by researchers who were studying optional front crash prevention features was how those features were paired with other features. This made it slightly more difficult to determine the effects of individual safety features. For example, many of the vehicles had adaptive cruise control but used sensors for detecting vehicles to the front for calculating safe following distances.

Safety features offer benefits beyond protection on the road. They can also help drivers lower their auto insurance premiums in some instances. To learn more about safety features and insurance, discuss concerns with an agent.


Small Business Owners: Optimistic but Cautious

While small business owners are generally upbeat about the future of the economy, they are also becoming more conservative in their willingness to take risks. These were the findings of a survey taken by financial services company The Hartford. They indicate that living through the Great Recession of the last decade has left business owners battle scarred and cautious about making dramatic moves.

The survey found that a rising share of small businesses were expecting a stronger economy. They were more bullish about their local economies than they were about the national economy, with 48 percent more optimistic about local conditions versus 22 percent more optimistic about the national economy.

In addition, they were less worried about economic threats to their businesses. Smaller shares of business owners cited slow economic growth, taxes, healthcare costs and uncertain federal regulations as major threats. In particular, the percentage of those worried about regulations fell 26 percent, and the share of those worried about taxes fell 17 percent.

Still, the percentage of small businesses rating themselves as conservative with regard to risk-taking rose from the year before, with almost eight in ten describing themselves that way. This indicates that the effects of the recession still linger. Until they feel more certain about their future prospects, they will be inclined to play it safe rather than take chances. 

The risk factors that worry them are those that affect their businesses’ profitability. For example, almost half of those who cited healthcare costs as a major risk said it was because they believe healthcare is unaffordable. Nearly a third of those who cited slow economic growth said it was because their customers were reluctant to spend.

Two-thirds of them considered themselves well-informed about the Affordable Care Act. Almost four in ten believed it would hurt their businesses; slightly more thought it would have no effect, positive or negative. Of particular note, 43 percent of businesses with 1-4 employees thought it would hurt, while 36 percent of those with 20-49 employees thought so.

The ACA’s tax penalties for employers who fail to offer affordable health coverage to employees do not apply to businesses with fewer than 50 workers. The high percentages of businesses below that threshold expecting the law to hurt them indicates that more information is needed. Those who expected it to hurt their businesses were contemplating reducing employees’ work hours, reducing future hiring or cutting jobs.

Most business owners are happy with the way their firms are running. More than 60 percent say that increased demand for their goods and services will help business, while half that number cited fewer regulations and deeper pools of qualified employees. However, they are not impressed with social media. Half of them feel it has no effect on their success.

Business owners want stable economic conditions and predictability. The Great Recession shook their faith in both. While their optimism appears to be returning, it may take some time before they are willing to make major investments in buildings, technology and creating new jobs.


When It Comes to Finances, Different Demographics Invest Differently

Women are lagging far behind men when it comes to accumulating assets in IRAs: The average male owns $153,649 in assets within 401(k)s. The average female owns just $94,774. The difference is also significant looking at median numbers: The median average balance across all IRA accounts for the average male is $41,057, while the median balance for women is just $29,651.


The report, entitled 2014 Update of the EBRI IRA Database: IRA Balances, Contributions, Rollovers, Withdrawals and Asset Allocation (EBRI Issue Brief) no. 424 was the latest update in ongoing research based on a database of 26.7 million accounts and 21.1 million unique taxpayers. The total amount of assets within IRA accounts were roughly $2.69 trillion.


Among the study’s other findings:


  • Asset allocation to stocks was relatively even among investors of all ages. Those aged 45 to 54 had the highest allocation to stocks, at 62 percent. But even those in their 80s and older retained an exposure to equities of over 53 percent.


  • Bond allocations peak with the over 85 crowd at 20.1 percent. Those entering retirement at age 65-69 held less than 18 percent of their assets in bonds while holding 52.9 percent in stocks – suggesting that today’s crop of near retirees is taking on more equity risk than prior generations. But yields on bonds tend to be lower than they were a decade or two ago, providing less of an incentive to hold them.


  • Only about 12 percent of all the IRAs that EBRI looked at received an active contribution in 2014. People were making active contributions to about one in four Roth IRA accounts, but only 6.4 percent of traditional IRA accounts.


  • The average balance in any given IRA, according to a new study by the Employee Benefit Research Institute, is slightly over $100,000. But since many people own multiple IRAs, the average account balance per IRA owner is much higher: The average U.S. taxpayer has $127,583 in total IRA assets, according to their research.


  • About one in four IRA owners took a withdrawal or distribution during 2014. Much of the withdrawal activity was driven by required minimum withdrawals (RMD)s, which affect traditional IRA owners who have reached the age of 70½. Among taxpayers under age 60 – the first full year in which they don’t have to pay a 10 percent excise tax on early withdrawals from IRAs, fewer than 12 percent took a withdrawal.


  • The average withdrawal amount from traditional IRAs varied with age. Those younger than age 30 who took a distribution withdrew $9,177. Those between ages 60 and 64 withdrew an average of $29,082. Withdrawals began to decline after age 65, perhaps in part because of the effect of Social Security income. The average individual age 71 or older took $17,900 from IRAs each year.


  • The average withdrawal rate from traditional IRAs was 5.8 percent. But the average withdrawal rate for those taking a withdrawal from Roth IRAs was almost 22 percent. Younger people are more likely to own Roths, and many of their withdrawals were early withdrawals, presumably for emergencies, and as younger Americans were from relatively lower balances. As balances grow, median withdrawal rates for Roth and traditional IRAs balance out.


  • Roth IRAs were slightly less likely to have had a distribution taken from them than traditional IRAs. However, about one out of four traditional IRA owners took withdrawals that were for more than required under RMD rules.

When it comes to Finances, Different Demographics Invest Differently

Interested individuals can find the full Issue Brief at EBRI’s website here.

Why Business Owners Need Terrorism Insurance

Terrorists attack a power plant that supplies electricity to a data center. The center houses numerous servers hosting hundreds of Web sites. A small business’s site goes down, shutting off 80 percent of its revenue flow.

Terrorists open fire at a shopping mall. The authorities close it for several days while they investigate the crime scene.

A bomb goes off in a building that is the location of several businesses. Hundreds of employees suffer serious injuries.

Terrorism is an unfortunate but real fact of life today. It can affect any business in any location at any time. With some exceptions, businesses do not have to buy terrorism insurance. However, it is a purchase they should seriously consider.

Terrorism insurance became a major concern after the September 11, 2001 attacks in the US. They cost insurance companies the 2014 equivalent of $43.5 billion. After that, properties and operations in likely target areas had trouble finding coverage.

To restore the market, in 2002 Congress enacted the Terrorism Risk Insurance Act (TRIA). Under this law, the federal government shares in loss payments with insurance companies. The government steps in once insured losses exceed a specific dollar amount. The law requires insurers to offer terrorism insurance to their personal and business customers. Business customers do not necessarily have to buy it.

To keep the terrorism coverage market viable, in early 2015 Congress extended TRIA for six years. The extension requires insurers to absorb a greater and increasing share of terrorism losses before they can receive federal reimbursements. For example, in 2015 industry-wide losses must exceed $100 million. That rises gradually to $200 million by 2020.

In some states and for some insurance coverages, terrorism coverage is not optional. For example, some states do not permit businesses to reject it for Workers’ Compensation. Others require it for fire insurance on buildings. For many other types of coverage, businesses can buy it for an additional premium.

Many business owners think the coverage is unnecessary. They cannot imagine a terrorist attack in their city. While attacks have occurred in large cities like New York and Boston, they have also happened in:

  • San Bernardino, California, population 214,000, in 2015
  • An office building in Oklahoma City in 1995
  • A subway in Tokyo in 1995
  • A shopping mall in the UK city of Manchester, population 520,000, in 1996
  • Airports in Rome and Vienna in 1985.

Also, as the examples at the beginning of this article illustrate, a business can be a victim of terrorism without being its target. A key supply chain can be disrupted. Authorities may restrict access to the area where the business is located. Utility service can be interrupted. All of these can cause businesses to shut down. One-third of insured losses resulting from September 11 were from business interruption, more than any other coverage.

Because of the unpredictable nature of terrorism, every business owner should consider buying the optional coverage. A professional insurance agent can an answer questions and estimate the costs. No one knows when or where the next major attack will be. Business owners should prepare for the financial hit they will take if it happens to them.

Study: Americans Workers Falling Short of Perceived Retirement Savings Goals

We are now eight years past the 2008 stock market crash and the beginning of the ensuing recession, but Americans have still not quite regained their financial footing.

That is the gist of the 17thAnnual Transamerica Retirement Survey – one of the longest-running retirement sentiment surveys in the industry, which was just released last month.

The cross-generational sample of U.S. workers overwhelmingly believe that their standard of living will decrease in their retirement years, and that they will have a harder time achieving any kind of long-term financial security compared to their parents.

In all, more than 8 out of every 10 Generation X workers anticipate that their generation will struggle to achieve retirement security. Baby Boomers fare better, with 45 percent of these workers expecting their standard of living to decline in retirement. Of Millennial workers, only 18 percent report that they are ‘very confident’ of their ability to retire.

“Although the Great Recession ended years ago, millions of Americans are still regaining their financial footing,” said Catherine Collinson, President of the Transamerica Center for Retirement Studies. “As each year passes, people’s fears about our current retirement system come more sharply into focus.”

Among other key findings:

  • Six in ten workers, or sixty-one percent, report that they have not fully recovered from the last recession. 13 percent reported that they have not yet begun to recover, and 7 percent told researcher that they may never recover from their financial setbacks in the Great Recession.
  • Nearly 8 in 10 workers – 77 percent – say they are concerned that Social Security will not be there when they reach their retirement age.
  • 65 percent of respondents report that they believe they can work until age 65 and not save enough money for retirement.
  • Only about half of workers surveyed – 51 percent – report that they believe they are building a nest egg that will be able to sustain them through their retirement years. Only 16 percent say they strongly agree that they are building a large enough nest egg to sustain them through retirement.
  • Almost four in ten respondents – 38 percent – said they plan on working well beyond age 65.


“Amid retirement savings shortfalls, American workers are attempting to prop up our system’s three-legged stool by adding a fourth leg: working during retirement,” said Collinson.

Generational Differences

The survey, published under the title Perspectives on Retirement: Baby Boomers, Generation X, and Millennials, looked at the differences in sentiment and outlook between the generations.

Baby Boomers

The survey found that 87 percent of Baby Boomers – the cohort born between 1946 and 1964 – expect Social Security to be a major source of retirement income, and one in three believe that Social Security will be a primary source of retirement income.

About one out of three expect income from a defined benefit pension, and 78 percent say they will be receiving income from private savings such as IRAs and other investments.

The median Baby Boomer savings in all retirement accounts among this cohort is $147,000.

Generation X

Generation X, those born between 1964 and 1978, is more pessimistic about their retirement prospects: Just twelve percent say they feel confident about being able to retire with an acceptable lifestyle.

Among Generation X workers, the total median household retirement savings for members of this generation thus far is $69,000. Generation X workers also tend to have very little in the way of funds to cover unexpected shorter-term setbacks, with a median of $5,000 set aside in reasonably liquid savings. One out of four Gen-Xers have less than $1,000 saved up.


Millennials – those workers born since 1979 – now make up the majority of the U.S. work force. They have begun saving in droves, with 72 percent of those with access to a retirement plan at work actively contributing. 30 percent of them are contributing more than 10 percent of their incomes to retirement plans such as 401(k)s.

Millennials overwhelmingly report that they would value more guidance and education from employers when it comes to saving for their retirement goals. Unsurprisingly, they are also the most digitally connected generation when it comes to their financial affairs: 80 percent of Millennial workers report that mobile apps to help track their finances are helpful, compared to just 48 percent of Baby Boomers.

The full study is available here.

Additional Employee Benefits at No Cost to the Employer

Many employers offer a wide range of these benefits to employees, all at no cost, since the employees typically pay all costs. Some employers, however, do choose to subsidize a portion of the premiums.

Popular Benefits

Life insurance is usually tops among voluntary employee benefits offerings. Companies can already deduct term insurance premiums they pay on employees’ behalf for up to $50,000 in death benefit per employee, under Section 7702. This death benefit is frequently too low for employees with families, so employers frequently offer additional life insurance via payroll deduction.

Other benefits include everything from dental and vision plans to long term care insurance to dread-disease and cancer insurance plans to disability income insurance to gym memberships. In recent years, pre-paid legal services and privacy protection services have become increasingly popular.  However, there’s nearly no limit to employee benefit providers’ creativity –  and plan providers have designed everything from auto and shopping discount plans to pet care programs to attract workers’ dollars.

Benefits to employees

For insurance-related products, employees benefit because if the pool and participation rates are large enough, employees benefit from simplified or guaranteed underwriting. For example, many voluntary benefit life insurance companies will issue a policy based solely on a short questionnaire and a medical background check, with no medical exam necessary. These workers may have a hard time buying this coverage in the individual market, but are able to get coverage as part of a larger group.

The second way employees benefit is by group discounts. Employees can often get needed benefits and services as part of an employee benefits program at a significant discount as part of a group, compared to what they would have to pay as individuals.

Benefits for Employers

Employers benefit as well, in a variety of ways:

Tax savings. Employees who buy certain kinds of benefits via a Section 125, or “cafeteria” plan do so pre-tax. This lowers the employers’ tax bill, because any dollars the employee contributes to a qualified plan benefit are not subject to Social Security and Medicare taxes.

Benefits can also help reduce absenteeism and increase productivity. For example, a worker whose family receiving benefits from a child care benefit program or long term care benefits covering a dependent is less likely to have to take unexpected time off work to deal with emergencies related to child care or care for disabled dependents.

Some research is showing a measurable increase in productivity compared to employees who do not have access to these benefits.

Lastly, a large package of employee benefits – whether they are employer-paid or sponsored as part of a voluntary benefits package or fringe benefits program- help build loyalty among workers, and help employers attract and retain talent in a competitive marketplace. A 2005 survey by LIMRA International found that six out of every ten employees surveyed believe that their line of voluntary and/or supplemental benefits was an important part of their total compensation package. They valued the convenience of paying via payroll deduction, and also the price discounts their employers were able to secure.

Four Common Workers’ Compensation Mistakes

Most employers look at workers’ compensation as just another necessary evil and unavoidable cost of doing business. It’s usually one of those out of sight, out of mind things when rates are low. It’s not until an employer is hit with a rate hike that they really start to give some thought to their workers’ compensation rates.

Employers need to constantly look at workers’ compensation as a tool to improve their business’s bottom line, and they certainly need to make an effort to keep their low rates over the long-term so that they can take advantage of some significant savings.

Here are four common mistakes made by employers that frequently deter their workers’ compensation savings:

  1. Assuming that lower rates equate to lower costs.

Don’t make the faulty assumption that your cost will automatically go down just because your rates have been reduced. Workers’ compensation insurers use an experience modification factor to examine the actual losses incurred by the insured company and establish cost. The actual losses are compared to other industry-alike companies. If the insured company’s past losses are below average, then the insurer gives the company a credit rating lowering their premium, but an added surcharge is applied to the premium if the insured company’s past losses are above average.

  1. Believing that employers have little control when it comes to the expense of workers’ compensation.

Employers know they’ve got to have workers’ compensation insurance. However, this acknowledgment shouldn’t lend to an employer thinking they’ve got to pay excessively for it; employers don’t and shouldn’t. Cost reduction starts at the hiring process. Initiate effective interview techniques and background checks to help ensure the right people are hired for the right jobs. That said, there’s no way to completely eliminate the possibility of injuries in a workplace. Therefore, it’s equally important to have an effective return-to-work program in place to simultaneously assist injured workers return to work as soon as possible and reduce the cost of their claims.

  1. Neglecting or de-emphasizing cost containment and injury management during low rate periods.

Safety should be an unyielding focus at all times. This will not only help a company reduce their claim numbers, but also keep their rates low over the long-term. Employers need to keep an eye on the issues that frequently impact the costs of claims, such as medical care costs and lost wages. Also, remember that open claims mean escalating costs and negative impacts to the company’s modification factor. Of course, this causes an increased cost for coverage.

  1. Not making the association between cost containment and worker retention.

Studies have shown that fewer accidents occur among skilled workforces, but even skilled workers can have an accident. A large part of whether or not an injured skilled employee returns to work is based on how their employer responds to them during and after recovery. An important part of an employer’s response will be in having a return-to-work program that includes maintaining constant contact with all injured workers and their health care providers to monitor how they’re recovering and when and how they can get back to work as soon as possible. Skilled employees that are kept in the loop with a return to work program’s periodic phone calls about what workplace changes are occurring in their absence are more likely to return. On the other hand, skilled employees that feel forgotten, undervalued, and disconnected aren’t very likely to return.

Do You Have Insurance When You Drive For Uber or Rent Your Home?

Ride-sharing company Uber did not exist in 2008. In 2015, it earned a reported $1.5 billion in revenue. Airbnb, the online home-sharing marketplace founded in 2008, lists rentals in 34,000 cities. Smartphone applications enable people to make money giving rides, renting their homes, and even their personal possessions. However, their insurance may not protect them when something goes wrong.

Those who drive for Uber and other transportation network companies may be doing so without insurance to cover them for injuries or damages they cause to others. Most auto insurance policies do not apply when the insured person is using a vehicle to give others rides for a fee (other than in traditional carpools.) While Uber, Lyft and other companies provide some liability insurance, that coverage might not apply before a passenger enters the vehicle.

If you are driving for one of these services, check to find out whether they insure you during your trips, how much insurance they provide, and what the terms and conditions are. Also, ask your insurance agent about policies that might cover you during the times when you are open for rides but before you pick up a passenger.

If you are the person purchasing the ride, find out ahead of time whether the company provides insurance for injuries to passengers and how much. If you live in a state with a “no-fault” insurance law, your own auto insurance policy may cover some of the costs of injuries you suffer during a ride. If your state has such a law and you get hurt in an accident, submit claims to both the driver’s insurer and your own.

Renting out a home or apartment via a service such as Airbnb may also leave the owner without coverage. Insurance companies have designed homeowners policies to insure homes for personal use. Renting out a home on more than an occasional basis may meet the policy’s definition of business use. Most policies provide very limited coverage for businesses run out of a home, if they provide any at all. This could leave you uninsured if your renters damage your property or get hurt during their stay. Check with your insurance agent to find out what your current policy does and does not cover. You may need to buy additional insurance to cover a home-based business. The home-sharing service may also offer some insurance.

If you are the person paying to stay there, your insurance may cover you if you damage the landlord’s property, but only for a few causes of loss. For example, you may have coverage if you cause fire, smoke or explosion damage, but not if you break a window or overflow a bathtub. Read the rental agreement, find out what you may be responsible for, and discuss coverage options with your insurance agent.

Smartphone technology has rapidly opened up new avenues for people to offer services for income and for others to purchase those services. All new opportunities come with risks. Make sure that you are properly protected against them.


Group Life Insurance – A Valuable Benefit

Group life insurance is among the most popular offerings in the employee benefit market today. Furthermore, millions of American families rely on it to provide desperately needed protection against the devastating risk of the unexpected death of a family breadwinner. The overwhelming majority of workers typically sign on to the program, when offered.

Group life represents about 41 percent of all life insurance policies in force, according to the American Council of Life Insurers, and provides an estimated $8.2 trillion.

Employees Need the Coverage

The average American family is woefully underinsured. Most families say they want or need enough life insurance to get them through 14 years of living expenses in the event of the death of a family member. One third of adults have no life insurance in place at all, including 2/3rds of American males, ages 18 to 24, according to information from the Life Insurance Marketing Research Institute (LIMRA). And 43 percent say they would experience severe financial problems within six months of the death of a family member.

How Group Life Works


The employer works with their benefits broker or agent to select a carrier and limit of coverage under the plan, as well as define who exactly qualifies as a member of the group eligible for coverage.

Employers pay some or all of the premiums on employees’ behalf. Generally, the premiums necessary to provide up to $50,000 in death benefits to each employee are tax deductible to the employer. Many employers choose to make additional coverage available, however – often on a voluntary basis. Additional premium is deducted from employees’ paychecks and sent to the insurance company via your normal payroll operation. If employees choose to participate via a Section 125 plan, or ‘cafeteria’ voluntary benefits plan, their premiums are generally paid with pre-tax dollars.

Some employers offer the same coverage to everyone. Others elect to offer a multiple of income – usually 1 or 2 times the workers’ annual income but sometimes more. This amount is usually paid for by the employer, but individual workers can choose to buy additional coverage on a voluntary basis.

Guaranteed Approval

Approval is generally guaranteed, provided the employer provides the coverage to all eligible employees. This is a valuable feature for many employees, because prior medical issues may make it difficult or impossible for them to qualify for health insurance on their own.

Advantages of Group Life

 For the employer, group life insurance is an important part of your company’s overall benefits package. Employees value robust benefits packages, and life insurance provides an essential protection that many of them could not get at all outside of a group plan. Statistically over 7 out of every 10 workers offered group life insurance via their employer take it.

The Bottom Line

The best reason for having group life insurance in place, though, is this: If an employee dies, and his distraught widow calls or comes to the office to ask if he had any life insurance in place, you can look that widow and the family in the eye and say “yes, absolutely. We loved him and valued him and we made sure life insurance was in place to protect the ones that he loved.”

To set up a group life insurance plan for your employees and help protect their families, call your insurance professional today.