Why Life Insurance Matters to Your People
Life insurance is one of the top 3 most valued employee benefits. Why is that? And how can you make the most of this popular perk?
Yugi the Giraffe - 20 May 2019
When it comes to purchasing employee benefits for your team, life insurance might be at the bottom of your list. Your employees are relatively young, your company is cool and slick, and you want something that will really pop on these job descriptions, rather than an awkward mention that will remind your prospects of their mortality.
The truth of the matter is, life insurance is consistently placed in the top 3 most valued employee benefits. It’s an attractive perk that your employees will actually be grateful for, even though it might not be the shiniest of benefits to offer (at least in its traditional form, but we’ll get to that later on).
We thought it would be really helpful to gather some information about the importance of life insurance, why your employees might want you to take a policy out for them, and what to notice if you are planning to do that.
Dazed and confused
Life insurance sounds complicated and scary, and to some extent, it was inadvertently made as such by the industry. People are confused by it, young people who are less likely to have dealt with it in the past in particular. That’s why a lot of your employees know they should probably get life insurance - especially as they start families and buy a house - but they just prefer not to think about it.
By purchasing a group life policy for your team, you can take away some of that grief for them (no pun intended). Your people trust you and know that you’re going to make decisions that are good for them, so they don’t need to go through the process of getting life insurance for themselves.
Financial safety net
Nobody feels completely financially secure in this day and age, but your younger employees are even more concerned with these troubles. Not only did they have less time to stabilise their financials (which you’re already helping with, being the amazing employer you are), they also entered the job market right after the 2008 financial crash, which made them more anxious about money.
This has two clear implications. Firstly, they’re less likely to want to spend their money on things that aren’t absolute necessities, and life insurance is more of a concern for the future (until it’s unfortunately too late). Secondly, they’re more likely to feel worried about their loved ones’ financial state, in their life but also after they’re dead. So, purchasing life insurance for them can relieve two of these concerns at once, and take their minds off something that may be bothering them quite a bit, freeing them up to be more creative and productive at work.
Not just for ‘grown-ups’
There’s a common misconception that life insurance is only relevant to people who have a family, a house or any of these big financial burdens. But the truth is that anyone who has people relying on them for money can benefit from a life insurance policy. What’s more, life insurance can help your employees even if they’re not financing someone else - as long as they have people they love and care about, and want to help when they’re gone.
Life insurance is also perceived as really pricey, which is not true (for example, our group life policies start from £4.99 per employee). That’s another reason why a lot of people leave it until they have to buy it - and then their life insurance premiums are normally higher. As an employer, you can usually get a deal that will cover all of your employees, regardless of medical issues or age - you just need to get a tailored quote.
We’ve already established that life insurance is a great first benefit to offer at your company. But there are a few things you might want to consider that will help you get the right policy for your company.
Engagement, engagement, engagement. On the one hand, you don’t want to have to deal with the admin of a policy more often than you need to. On the other hand, you want your employees to get the most out of it, and engage with it every day. In other words, you want to put away the documents and forget about them, while your employees are reminded of the amazing gift you got them constantly. Many life insurance companies will do the first - only after you’ve dealt with the bureaucracy of actually purchasing the policy, of course - but not a lot will do the second.
Simplicity is key. Many life insurance companies have you going through hoops just to get a policy in place. This is because they still rely on old fashioned models that haven’t been updated to modern life. Try to find a company that puts transparency and simplicity first, and uses technology to help you make the process as seamless and hassle-free as possible.
Look for tangible value. Life insurance is a great when it comes to dealing with the worst. But if you’re paying for a policy, it’s only natural to get one that will have value now, as well as in the future.
Tailored to your needs. Company life insurance can rarely cover all of the costs a family would need, which is why a lot of employees will opt to purchase personal cover for themselves, as well as the group policy their employer provides for them. Try to find a life insurance company that your employees can use to add cover if they want, and that will cause you and them the least headache in the process. For your benefit, we’ve attached a quick explanation about the difference between group life and personal life policies, in case you want to show your employees who are planning to top-up their current cover.
|Question||Group life||Personal cover|
|Who owns the policy?||Your employer||You do|
|Who gets the money?||Your beneficiaries||Your estate/your beneficiaries, if you write it in trust|
|How much cover do I have?||Your cover will usually be linked to your salary. Eg. four times your salary||You decide when you are buying it|
|Do I need to go for medicals?||Usually not||Quite often|
|Will I be rejected for pre-existing conditions?||Usually not. Most of the time the policy covers all employees regardless of their medical history||You may well be rejected. If they do accept you, they will likely increase your premium|
|How long does it take to get cover?||Cover is automatic, but sometimes only once you've worked at the company for a fixed period of time||Anywhere from 20 minutes to several weeks.|
|What happens if I leave my job?||You will usually lose your cover||The policy carries on|
This table gives the common answers among many insurance policies, but each insurance company sets its own rules which may be different from these.
If you’re wondering which company can actually provide all of these, we think yulife is exactly what you’re looking for. Our policies can be purchased online or on the phone (however more convenient for you), and managed completely online. This means you have minimum admin-hassle. yulife also allows members to top-up the cover with a personal life policy, all online, seamlessly. They can then manage their policies and change them as they wish.
We believe that wellbeing and company life insurance are naturally connected, as healthier members mean lower risk, as well as a happier and more productive workforce. That’s why each one of our policies comes with a wellbeing app that rewards your people for healthy activities, such as walking or meditating, with Avios air miles or gift cards from brands like ASOS and Amazon. With high engagement rates, many of your people will use the app every day.
For more information about yulife, book a demo here.
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Yugi is our YuLife mascot. Like all giraffes they've got a big heart – in fact the biggest heart of all land animals.