Term Life Insurance

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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

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