This blog covers another area of employment incentives that people care passionately about: insurance. As we all know, costs have soared over the past decade. I think insurance is somewhat of a scam, but at the same time, I recognize that it’s a safety net to protect you and your loved ones. Employers have recognized that basic coverages aren’t cutting it, so many offer better options. Look at what I’ve seen:
Health
Healthcare costs have gone through the roof, and employers often pass increases to their employees (much to their dissatisfaction). Part of a “total rewards” package includes decent health insurance coverage options at affordable costs to the employee.
100% paid-for health insurance
Companies that want to attract and retain talent are now offering something almost unheard of – 100% employer-covered health insurance. I don’t know whether these are high-deductible plans, but regardless, it’s hard to beat having your health insurance premiums fully paid by your organization.
Lower-cost health insurance
While 100% coverage might not be affordable for all companies, those that can afford it absorb increases rather than passing the cost on to their employees. Of course, they make sure their employees know about this and tout it as a benefit of their employment.
High-deductible Plans
I have chosen high-deductible healthcare insurance since the early 2000s. The deductible is high with this type of plan, but it keeps the premium much lower. If your family is healthy and you don’t expect to spend a lot on healthcare, this is a good choice. Some companies even incentivize employees to choose this option by making a sizeable contribution to the employee’s accompanying Health Savings Account.
Health Savings Accounts (HSA)
Unlike flexible spending, employees own their Health Savings Accounts, and they’re portable. Not only that, but there’s no “use it or lose it” requirement, and the money can roll over from year to year. You may also have the option of managing the investment of the funds you contribute to grow your saved money. Contributions are also pre-tax, reducing your overall taxable income, and any spending on qualified items from your HSA is tax-free, giving you additional money-saving benefits.
Health Reimbursement Arrangement (HRA)
I’m honestly a bit fuzzy on Health Reimbursement Arrangements. I have participated (via my husband) in this type of program before, but I never understood how it worked. I’m sorry I’m not an HR expert – all I know is that this is another advantageous way of saving money when using your health insurance. (Now, let’s see if anyone reads this and can explain HRAs to me.)
Dental
I’m a bit of a freak regarding dental care, so having dental insurance is crucial to me. I once experienced some time without dental coverage, and I went a few years without check-ups; when I finally got dental insurance again, I underwent the most brutal tooth cleaning of my life. [HINT: go to your twice-annual dental visits.]
Dental Insurance
Sadly, I think the options for dental insurance have been limited for a long, long time. The plans typically cover most preventive care and a percentage up to a capped amount for other items. It seems that the coverage limits are low, and they haven’t changed much in decades. Most major dental procedures are costly, and the minimal amount covered is insufficient to pay for those types of treatments (and I should know, I had to have two dental implants).
Orthodontia
Another area where I think organizations could improve their offerings is in orthodontia. I have had braces not once, but twice, and the second time I had to pay for them myself; braces aren’t cheap. My youngest child now needs to go in for an orthodontic consult, and I dread their recommendation. Many companies cover a limited portion of treatment, but some limit it to your minor children. I still need replacement retainers from time to time, so I was delighted to learn that my new employer offers orthodontia to adults, not just children.
Vision insurance
Not all companies offer vision insurance, and of those that do, the costs tend to be low, but so is the coverage. Exams are generally included, with an option for either glasses or contacts (but typically not both, which I have never understood). If no insurance is offered, some organizations offer discount programs, which aren’t really insurance, but I suppose it’s better than no coverage.
Pet Insurance
I have had many pets in my life, and I often wondered why pet insurance didn’t exist or wasn’t a prevalent offering from employers. Over the last few years, I have noticed more and more companies offering plans to cover our furry friends. Like vision insurance, options tend to be discounts or, for a higher cost, insurance that mimics human healthcare options (which is what I currently have through Bivvy.com).
Life Insurance
There are different kinds of life insurance (which I won’t get into in this blog). Most companies offer some options.
Company paid-for life insurance
Based on my experience, most organizations provide you with a basic life insurance policy that gives you up to a specified limit (usually based on your salary). Basic life insurance is a nice perk, especially if you’re young and don’t expect to die soon.
Supplemental life insurance
If you are worried that your company’s standard policy won’t be enough should something happen to you, many organizations offer supplemental life insurance. Sometimes there’s a guaranteed amount you can purchase without going through a health exam; if you want more coverage, you may need to prove that you are insurable.
Life insurance for spouse and dependents
Again, most companies that offer life insurance also give you the option to cover your spouse and dependents at low costs. The amount to protect children is typically trivial (because you expect them to live a long time), while the spousal coverage costs increase based on age and tobacco usage. The coverage I have for my husband and kids would cover a funeral, but not much more than that (which I don’t even want to think about).
Portable policies
One nice benefit of a life insurance policy that not all companies offer is the ability to take the policy with you. I had great coverage through one of my employers, and when I left the company, I was delighted that I could continue coverage at the same group rate even after leaving. Of course, my premium has still gone up as I have aged, but it’s still a damn good deal.
Disability
No one wants to think the unthinkable – that you could become disabled one day. But the fact is that many people do. Whether it’s through accident or illness, many people end up unable to perform their jobs at some point in their lives; this can leave you in a precarious financial situation.
Short-term Disability
Policies that cover you for the short term are typically meant as a stopgap to get you through a brief period while recovering from surgery, having a child, illness, etc. The problem with these policies is that there is typically a waiting period before you qualify, and the amount provided is a mere percentage of what you would normally make. Fortunately, most companies offer this option to you at no cost.
Long-term Disability
Long-term disability becomes more of a concern the older you get. For people who are permanently disabled, having this type of policy is a godsend. Being disabled and having no earned income is a horrible situation, but you have a safety net if you have a long-term disability policy. Again, I’m not an HR expert, but this seems essential.
Other
Last but not least are the other pesky insurance options that your employer may offer. I have not signed up for these policies myself because it seems highly unlikely to me (based on my lifestyle) that I will need this type of coverage. But, if you have any concerns for yourself, you might consider them.
Accident Insurance
We all know that accidents happen every day. Cars crash, bicycles get hit, drunk drivers are on the road, planes fall from the sky (this happened only a few miles from me a few years ago), or you might fall off your roof. When an accident occurs, this insurance covers much of the expense of dealing with the outcomes of the accident; whether it’s the Emergency Room, surgery, physical therapy, or whatever else, it provides you a little bit of extra buffer to help pay for your medical expenses.
Critical Illness Insurance
One final insurance offering you might want to buy is for critical illness. If you know that a disease runs in your family or have some bad habits (smoking, drinking, etc.), you might be at high risk of developing a critical illness such as cancer or a stroke. It might be worth shelling out a few extra bucks to give you the peace of mind that should you have a critical condition.
Final Thoughts
Although I have long thought insurance to be a scam, it’s still vital to have – especially as you have children or grow older. Be proactive with your health wherever possible, but when the unknown happens, you also need to be prepared; insurance provides you with the financial support to weather life’s storms. God forbid anything should happen to you, but you can rest easy knowing your family will be all right if it does.
If you missed any of the previous blogs in this series, check them out:
- Innovative Employee Incentives in the age of COVID
- Incentive #1: Work Environment
- Incentive #2: Workspace & Tools
- Incentive #3: Work Schedule
- Incentive #4: Health & Wellness
- Incentive #5: Professional Development
- Incentive #6: Time Off
Sorry to leave you on that sobering thought. Now, it’s your turn. Are there any forms or options of insurance that I missed? Can anyone (please) explain HRAs to me? If so, please let me know in the comments below!