Take Advantage of ALL of Your Employer’s Benefit Offerings

Bob Herum, MSFS, CLU, ChFC, RHU, REBC

Editor’s Note: When the leaves start to fall, it’s usually the time for you to enroll in your employer’s benefits offerings. A lot of us focus our time on understanding the health insurance benefits, but you could be leaving a lot of money on the table with that approach. Make sure to take the time to learn about other benefits such as short- and long-term disability coverage, group term life insurance, accident coverage, and critical illness insurance.

Fall is typically when employers let employees know about benefit enrollments and any changes to your benefits and/or premiums. During this season, I highly recommend spending some additional time to look carefully at the options available to you and taking advantage of employer pricing for any guarantee issue or simplified issue disability income insurance plans.

The Importance of Voluntary Benefits and Income Protection Insurance

Attention often is focused on the health insurance options and premiums. While critically important, other benefits such as a voluntary term life or disability programs, and accident and critical illness coverages can become afterthoughts. The COVID-19 pandemic has shown that the unexpected does happen and having additional resources to help navigate through unexpected events is important.

Unlike the pandemic, normal circumstances such as a long-term illness or severe injury does not trigger Congressional relief. You are left to manage expenses on your own, which could be a challenge if you have reduced or no income.

So how do you decide what benefits make the most sense for you and your family? You’ll need to do some research and reading. Also, take advantage of any discussions or meetings offered through your employer.

I’ve summarized a few insurance benefits below and how they might be useful. Your employer may offer additional benefits. For each one, it’s important to do your research and make a conscious decision to either purchase or waive the coverage.

Employee Benefits is About Much More Than Health Insurance

- - - Group Term Life Insurance: pays a benefit if you die to a beneficiary you name. Some employers offer voluntary life insurance coverage above the traditional employer-paid group term life insurance plan.

Since most employer-provided insurance plans do not provide sufficient monies to allow your beneficiaries to maintain their current standard of living, you may want to consider applying for the additional voluntary term life insurance. Typically, you are responsible for the full premium amount. However, this benefit may be an inexpensive way to obtain additional life insurance protection.

- - - Group Short- and/or Long-Term Disability Insurance: replaces a percentage of your income if you can’t work because you’re sick, injured, or having a baby. As the name implies, short-term disability insurance covers you for a short period of time (usually three to six months) while long-term disability insurance covers you for a much longer period of time – often until you reach Social Security retirement age.

If an employer-paid short- or long-term plan is in place, your employer likely pays your premiums, which means taxes will be deducted from any money paid to you from the plan. If there is a voluntary plan option for either short- or long-term disability insurance, you may want to consider purchasing. When you pay for insurance with after-tax dollars, any money paid to you from the plan will not be taxed. This means you receive more of the benefit.

Voluntary disability insurance plans available through your employer may provide a simple enrollment process, guarantee issue and group rates.

- - - Accident Coverage: provides you with money if you suffer an unexpected, qualifying accident. It can help cover costs associated with medical care and/or hospitalization, and out-of-pocket expenses related to your injury. Some plans allow you to cover your spouse and your dependent children.

- - - Critical Illness Insurance: pays a benefit if you suffer a medical emergency that is covered under the plan. Common critical illnesses include a heart attack, stroke, or cancer. Emergencies like these incur greater-than-average medical costs, which may mean traditional health insurance plans fall short. The extra dollars from this type of insurance can help offset some of those high medical expenses.

As I mentioned, your employer may offer additional benefits, but the point of this article is to encourage you to review all your options. Do the research so you can make an informed decision based on your needs and budget.

About Bob Herum

Bob Herum has written 11 posts in this blog.

Bob Herum, MSFS, CLU, ChFC, RHU, REBC, DIA, DIF, LTCP CDA President. Bob has over 30 years of experience in the insurance industry and has demonstrated success as a producer, a wholesaler and as a manager. Bob has been published in such magazines as The American College’s Wealth Magazine, National Underwriter, Life Insurance Selling, Broker’s World, NAIFA’s Advisor Today and Health Insurance Underwriters (HIU). Additionally, he has spoken at national, regional and state forums on a variety of disability and worksite sales topics and is a recipient of the W. Harold Peterson Lifetime Achievement Award by the International Disability Income Society (IDIS). Bob retired as a Colonel from the Army Reserves. He is a past President of the Columbus, Ohio NAIFA chapter, a two-time past President with the International Disability Society, past-chair of the NAHU’s Disability Insurance Advisory Group, and past-President for the Cincinnati Society of Financial Service Professionals (FSP). Bob is married to Teri and has one son, Nick.