Reduce financial stress with this type of insurance. Research by Life Happens shows most Americans with life insurance experience less financial stress knowing their family is financially protected.
Americans say feeling financially secure adds the most meaning to their lives, even more than being in love or owning a home, according to recent research by Life Happens, a nonprofit organization dedicated to educating the public about important insurance planning topics like disability, long-term care, and life insurance.
Almost 80 percent of Americans agree that preparing financially for life’s unknowns is a way to show loved ones that you care and more than 60 percent of Americans think that having life insurance is the key to taking care of their family financially.
How Life Insurance Reduces Financial Stress
“Let’s look at the example of the government shutdown,” says Marv Feldman, CEO of Life Happens. “All of a sudden we’re seeing government employees who can’t afford to go to the grocery store or go to the doctor because they missed one or two paychecks. What if one person is gone forever? How do they replace that paycheck? Through life insurance. It brings to the forefront that people need to plan for these types of events when the payroll disappears.”
Reducing financial stress is a top priority for close to 80 percent of Americans. Nearly 70 percent of Americans with life insurance say they are less financially stressed. More than 60 percent of people with life insurance say they’re able to enjoy life more knowing their loved ones are financially protected with life insurance.
How Employer-Sponsored Life Insurance Can Reduce Financial Stress
“One of the things we saw after the recession in 2008 was many companies were so financially stressed that they started cutting their benefits. Some companies even eliminated group term life insurance. For those same employees to go out into the marketplace and replace those benefits is much more expensive than what they could get from an employer’s plan,” says Feldman. “It’s really important for individuals to work with HR departments and maximize their benefits, and determine how they can enhance what they replaced or lost.”
Employers who offer life insurance know their employees are getting coverage at a lower cost than if they were to seek coverage on their own. Money that would have been spent on life insurance can then go towards paying down debt or saving for emergencies or retirement, lessening their overall financial stress.
How Employers Can Communicate Value of Life Insurance
“Employers, in general, do a very poor job of communicating the value of the benefits employees receive from the company that they don’t pay for,” says Feldman. He says it’s important to communicate that cost comparison so employees know what they’re getting. “An example would be if you go to a Hyatt or a Marriott and used to get free parking, now it could cost up to $50 per day. A lot of employers pay for parking which adds up to a significant benefit.”
Total compensation statements are annual statements that list an employee’s compensation as well as their benefits and those employer costs. It might make sense to include with benefits offerings a market cost comparison of organizational costs versus individual costs to underscore how much an employee can save by participating in a group plan.