Abstract
Employee insurance programs provide employees with benefits that are very critical to their lives and their families. Whereas the law requires employers to give some benefits to their employees, some companies give voluntary benefits to their employees. Each of the insurance programs differs in the kind of benefits they provide to the employees. Term life insurance offers employee protection for a specific period. Whole life insurance policy provides permanent protection where the policy runs for the whole lifetime of the person insured as long as the company pays premiums to maturity. Accidental death and dismemberment policy give benefits to the beneficiary only if the cause of the death is an accident. Long and short term disability
…show more content…
At the expiry of the policy period, it is upon the employer to make decisions whether to continue with the policy or let it end. In case the life insured passes on during the insurance term, the beneficiaries will receive the death benefits. If the term of the policy expires before death, the insured cannot get any death benefit (Griffes, 2003). Term life insurance has been found to be the cheapest way of purchasing a considerable death benefit over a particular period for employees in an organization. The purpose of term life insurance policy is to insure people against loss of life. An individual’s health and age determine the amount of premium a company is needed to pay for the …show more content…
The policy is, therefore, cheaper for organizations. Because of the low premiums, most companies’ voluntarily take this policy for their employees. The insured beneficiaries are likely to get benefits if the person’s death is as a result of an accident.
b) Good for young employees
Young workers are likely to die more as a result of accidents than from illnesses. Companies, therefore, choose this policy because it can benefit their young employees more than the older employees. Moreover, young employees usually do not have any individual accident insurance cover hence the company helps these employees through taking for them an accidental death and dismemberment policy (Employee Benefit Research Institute (Washington, D.C.), 2000). The policy helps the young people to maintain the young and their families recover the income they lose through loss of their body
COBRA was passed in 1986 and provides guidelines for continuous health coverage in case of sudden loss of a job or even death among other situations that cannot be avoided. Employees as well as employers have to participate in the program to make it effective. The employees are guided by the “Employee Benefits Security Administration” and the “Employee Retirement Income Security Act” to fill out forms of compliance. The law was designed to find temporary solutions for continued medical insurance so that the unemployed can still enjoy and access healthcare facilities despite the financial misfortunes that may render them unable to support themselves as well as their families as they find a permanent solution (Magill, 2009).
...only one underlying purpose and that is to increase profits for the company and shareholders. Corporations have taken the position that there is a profitable benefit in having life insurance policies in the name of their employees. Corporations are just maximizing their position by looking at all legal resources that the corporation has at its disposal. As an employee you are receiving some sort of benefit from the corporation such as a salary, medical, dental, profit sharing, 401k plan and any other benefit that is offered. I don’t believe that corporations always do the right thing in regards to their employees but, I also believe that employees have come to believe that they are entitled to more than what is already offered to them. As an employee you do have a choice on whether or not you want to continue to work for any corporation that behaves in this manner.
Large corporations take out life insurance policies on employees that have an increase chance of death. Now the problem with this is instead of a family member being the beneficiary, the company is. These corporations do not inform the employees that they have this life insurance. So when the employee dies, the company gets all the money from the insurance and the grieving family members get none. This act could be justified if the employee agreed on the company taking the life insurance policy and having the company be the beneficiary. The corporations have research who has an increased risk of death in the near future. The corporations pick people that smoke or at a higher risk for a heart attack or stroke or of a certain age. These acts are viewed as unethical, especially by the average ...
a. Defined benefit health and welfare plans—Defined benefit health and welfare plans specify a determinable benefit, which may be in the form of a reimbursement to the covered plan participant or a direct payment to providers or third-party insurers for the cost of specified services. Such plans may also include benefits that are payable as a lump sum, such as death benefits. The level of benefits may be defined or limited based on factors such as age, years of service, and salary. Contributions may be determined by the plan 's actuary or be based on premiums, actual claims paid, hours worked, or other factors determined by the plan sponsor. Even when a plan is funded pursuant to agreements that specify a fixed rate of employer contributions (for example, a collectively bargained multiemployer plan), such a plan may nevertheless be a defined benefit health and welfare plan if its substance is to provide a defined benefit.
What is Accidental death & dismemberment insurance? According to the definition from Bearu of Labor Statics its term used to “describe a policy that pays additional benefits to the beneficiary if the cause of death is due to a non-work-related accident. Fractional amounts of the policy will be paid out if the covered employee loses a bodily appendage or sight because of an accident”. ("BLS Glossary", 2016) This program does not stop you from receiving additional life insurance. This insurance program covers many forms of incidents such as Traffic accidents, homicide, falls, and heavy machine accidents and drowning. Now with these incidents there are a couple of incidents that are not covered suicide, war injuries, drugs and alcohol. If you have any drugs or alcohol in your system when the accident occurs they insurance company has the authority to withhold those
Offering employee benefits is one way a company must competes in today’s marketplace to retain old employees and attracts new ones. These benefit packages may range from offering basic health insurance to additional discretionary and perk benefits such as vacation and retirement packages. Benefit packages are often a large portion of employee costs and Federal mandates require an employer to carry and offer certain benefits even if they offer nothing else. Federally required employee benefits make up approximately a quarter of the costs associated with employer offered benefit packages. Some of these mandated benefits include Social Security, Worker’s Compensation Insurance, and the Family Medical Leave Act.
Health insurance provides benefits for sickness, injury, surgery, and prescription medication. There are a variety of plans with different
Term life insurance, also called temporary insurance, covers a person against death for a limited time, the term. Term Life provides a cost-effective solution for your temporary life insurance needs and gives you the flexibility to change your policy should your temporary needs turn into permanent goals.
Today, world’s population is aging at a very fast pace and United States is no exception to this demographic change. According to the U.S Census Bureau, senior citizens will be accounted for 21% of the American population in 2050 (Older Americans, 2012). Although living longer lives may not seem like a negative sign, living longer does not necessarily mean living healthier. Older adults of today are in need of long-term and health care services more than any generation before them (Older Americans, 2012). Because of the growing need for senior care, millions of families are facing critical decisions on how to provide care for their parents. In addition, declining birthrates may cause people to have less familial care and support as they age. To be able to provide the necessary care for senior citizens government funded long term care insurance program is needed.
Take note that other types of life coverage, such as term life insurance, have no cash value and offer cheap premium rates, which are lower than those of variable universal life insurance. However, the latter is more affordable than other forms of permanent coverage. Also, it combines an insurance policy with an investment vehicle, and its price reflects the dual nature of the policy. So, if you are looking for a good means to grow a financial asset or build a nest egg for retirement, universal life may be your best
J. David Cummins, A. S. (1999). Changes in the Life Insurance Industry: Efficiency, Technology and Risk Management: Efficiency, Technology, and Risk Management. Springer.
During the nineteenth and early twentieth century if a worker was a victim of workplace accident there was no compensation or requirement of the employer to support rehabilitation. Employers were not responsible for injured workers or accidents that happened in the workplace. The main legal doctrine of Assumption of Risk governed workplace hazards, which required workers to assume and accept all the risks affiliated with their occupation (Share, 2012). In the 1900 's many diseases and injuries resulted due to unsafe or hazardous working condition. "The Royal Commission on the Relations of Labour and Capital reported in 1889 that many workers were being hurt on the job and condemned the state of working conditions in several industries" (CPHA, 2012). However, the federal government at the time did not act on the results of the commission report. In 1914, the province of Ontario introduced legislation where, "workers would be eligible for guaranteed no-fault benefits from a system that was wholly funded by employers. In exchange, employers were freed from legal liability" (CPHA, 2012). This was the first time the idea came up that injured employees should be compensated no matter who was at fault for the accident. This was the sign of the beginnings of change, but perspectives on health and safety still held employees responsible and accountable for all injuries and
95% of all term policies go unpaid. In other words, if you took a random sample of 100 people who purchased term insurance, 95 of them would outlive their terms. The insurance companies know this. That is how they can afford to offer a 45 year-old male $250,000 worth of coverage for a 20-year term for only $375 per year. They've crunched the numbers and are willing to bet that you and a whole lot of other people are going to outlive your policies. Because term is inexpensive, there is much less commitment. When you want o...
Accidents occur in the workplace but in secret. These most of the time lead to physical and mental injuries that might affect the worker way of living for the rest of their lives. It is estimated that more than 337 million workers get injured in their place of work or in the course of work every year leading to work-related diseases causing about 2.3 million deaths per year (United States Department of Labor, n.d.).
The insurance is meant to cover the cost costs associated with long-term care for those who have had strokes, chronic diseases, or Alzheimer’s diseases, as well as those who can simply no longer manage to live on their own. It is imperative that I be able to reap the cost-benefits to of being protected against the financial consequences of the high cost due to increasing life expectancies and the resultant rise in the chance that you may eventually need some level of care. In short, creativity in decision making is vital to effective choices. Therefore, it is essential to consider all of the possible alternatives will help you make more efficient and favorable decisions. Moreover, when life events affect your financial needs, the financial planning process will provide a vehicle for adapting to those changes. Also, specific financial goals are vital to financial planning. Others can suggest financial goals for you; however, you must decide which goals to pursue. Your financial goals can range from spending all of your current income to developing an considerable savings and investment program for your future financial