Voluntary Life Insurance
Candlefocus EditorEssentially, voluntary life insurance provides a death benefit to an individual’s beneficiary (or beneficiaries) after the insured employee’s death. This death benefit is an agreed-upon amount between the insurance company and the employer and is typically paid by a monthly premium deducted from the employee’s paycheck. The amount of the premium will vary based on the employee’s age and the chosen coverage amount.
Immediately upon hiring or shortly after, employers will often offer their employees the option to enroll in voluntary life insurance. This coverage is generally easier and less expensive to obtain than coverage purchased in the retail market, making it an attractive and convenient way to provide financial protection for loved ones. It also typically declines in premium amount as the employee ages, making it an inexpensive way to offset the rising cost of personal life insurance.
Voluntary life insurance coverage will usually end upon the employee’s termination or if they quit. However, some employers may allow employees to continue benefits through direct-bank billing regardless of their employment status.
Overall, voluntary life insurance is a great way to provide much-needed insurance protection without the high costs that come with individual policies. Not only does it bring peace of mind for both the insured employee and their loved ones, it also helps employers demonstrate their commitment to employee well-being.