Insurance & LawStartups

A Primer on Voluntary Benefits

Voluntary benefits are 100 percent paid by the employee. Employees can choose which voluntary benefits are best for their own situation. Some voluntary benefits pay cash benefits directly to employees to cover living expenses, lost wages, copayments and deductibles.

These benefits include primarily life, accident, and critical illness insurance. Additional products that can be offered include disability, cancer, supplemental hospital, dental and vision insurance.

Overview of Voluntary Benefit Plans

Life Insurance

Life insurance protects your employees’ families by providing for a cash benefit upon the death of the employee. This benefit can be used to pay for mortgages, final expenses and income protection. Rates are based on a number of factors that include the size of the group, the company claims history, the occupations, gender, age and salaries of employees.

Click here to watch a video about Life Insurance

Accident Insurance

Accident insurance helps cover costs associated with accidental injuries including accidental death. Coverage can be for 24/7 or just off-the-job injuries. Generally, there is very little medical underwriting associated with this type of plan and the cost is very reasonable.

Click here to watch a video about Accident Insurance

Critical Illness and Cancer Insurance

Both critical illness and cancer offer coverage for specified illnesses and disease. Critical illness insurance provides lump sum cash benefits upon diagnosis that can help with daily and out-of-pocket expenses. Cancer insurance provides cash benefits for treatments and expenses as they happen.

Click here to watch a video about Critical Illness Insurance

Click here to watch a video about Cancer Insurance

Disability Insurance

Disability insurance provides your employees with a monthly cash benefit in the event they are unable to work due to sickness of injury. These benefits can last anywhere from 3 to 24 months. Plans differ widely on what disabilities are covered so be sure to read the fine print.

Click here to watch a video about Disability Insurance

Supplemental Hospital Insurance (SHOP)

SHOP provides cash benefits for hospitalization, surgery, outpatient, nursing and transportation expenses as they happen.

Click here to watch a video about Supplemental Hospital Insurance

Dental and Vision Coverage

Dental and vision insurance are designed to maximize choice in provider and services, and minimize cost to your employees. The costs of dental and vision benefits depend on different factors, including plan design, provider network, and administrative expenses.

Common Features of Voluntary Benefits

  • Voluntary benefits are a form of compensation and assist employers in recruiting and retention.
  • Employees trust their employer’s HR team more than their own decision-making when it comes to purchasing insurance. Simple options that have been vetted by HR professionals make employees feel better.
  • Group benefits are almost always a better value than individual benefits. Employers buy group coverage and pass on the lower cost and minimal to zero underwriting for the employee. This makes for a much simpler enrollment.
  • Payroll deduction is the most convenient way to purchase benefits making it easy for employees to pay for coverage. Certain benefits can be offered pre-tax while others like disability insurance are offered after tax.
  • Offering these benefits will not interfere with an employee’s eligibility to apply for and receive a subsidy through a health insurance exchange. All of the benefits mentioned will pay in addition to any qualifying health coverage that an employee may have purchased.

Now that you know more about voluntary benefit plans, click here to learn about a new voluntary benefit program created just for small business owners.


Protect what matters most. Business Insurance built for small businesses like yours. Request a quote now.

More Articles You May Like

Back to top button
Share this
Send this to a friend