Life Insurance Options for Your Long Island Business

When talented employees are considering job offers, life insurance benefits often tip the scales. For Long Island business owners, understanding your life insurance options can be the difference between landing that perfect candidate and watching them walk away to a competitor with better benefits.

Life insurance through work isn't just about peace of mind—it's about showing employees you care about their families' financial security. Let's break down what you need to know.

What Is Employee Life Insurance?

Employee life insurance provides a financial safety net for workers' families if the employee passes away. Think of it as a paycheck replacement that helps surviving family members cover immediate expenses like funeral costs, mortgage payments, and daily living expenses during a difficult time.

Unlike personal life insurance policies that employees buy on their own, workplace life insurance is typically more affordable and easier to obtain because it's offered to groups rather than individuals.

How Workplace Life Insurance Works

Most employers offer two types of life insurance coverage:

Basic Group Life Insurance: This is coverage you provide to all eligible employees at no cost to them. You pay the premium, and employees automatically receive coverage—usually equivalent to one or two times their annual salary. For example, an employee earning $50,000 might receive $50,000 or $100,000 in coverage.

Voluntary Life Insurance: This allows employees to purchase additional coverage beyond the basic amount, paying the premium through payroll deduction. Employees can typically buy coverage for themselves, their spouse, and dependent children. The rates are usually lower than individual policies because of group pricing.

Most policies also include Accidental Death and Dismemberment (AD&D) coverage, which provides additional benefits if death or serious injury results from an accident.

Term vs Permanent Life Insurance Options

Term Life Insurance is the most common type offered through employers. It provides coverage for a specific period (the "term" of employment) and has no cash value. Premiums are typically lower, making it cost-effective for both employers and employees.

Permanent Life Insurance includes whole life or universal life options that build cash value over time. While more expensive, some employees value the investment component and guaranteed coverage that doesn't expire.

Most Long Island businesses start with term life insurance due to its affordability and simplicity.

Why Smart Employers Offer Life Insurance

Life insurance benefits help you compete for talent without breaking the budget. Here's why it works:

• Low cost, high perceived value: Basic group life insurance is relatively inexpensive but employees see significant value in the protection
• Attracts family-focused employees: Workers with dependents especially appreciate employers who think about their family's security
• Improves retention: Employees are less likely to leave when they have valuable benefits that might not transfer to a new job
• Tax advantages: Employer-paid premiums for basic coverage up to current IRS limits are generally tax-deductible for the business

Without life insurance benefits, you're asking employees to secure this protection entirely on their own—often at higher individual rates and with more complex underwriting requirements.

What Employees Get From This Benefit

From your employees' perspective, workplace life insurance solves several problems:

Immediate protection: Coverage often begins quickly with minimal or no health questions for basic amounts, unlike individual policies that require extensive medical underwriting.

Affordable rates: Group pricing means lower premiums than they'd pay for individual coverage.

Convenience: Premiums are deducted from payroll automatically—no separate bills to remember.

Family coverage options: Voluntary plans typically allow coverage for spouses and children at group rates.

For many employees, workplace life insurance provides their first substantial coverage, giving them time to evaluate their long-term insurance needs.

Key Considerations for Long Island Employers

When designing your life insurance program, consider these factors:

Coverage amounts: Basic coverage of one to two times salary is common, with voluntary options allowing employees to purchase additional multiples based on their needs.

Portability: Look for plans that allow employees to convert or continue coverage if they leave your company. This adds value without costing you extra.

Employee communication: Life insurance benefits are only valuable if employees understand them. Clear communication about coverage amounts, beneficiary designations, and how to access benefits is crucial.

Industry considerations: Medical practices, law firms, and other professional services on Long Island often offer more generous life insurance benefits to compete for skilled professionals.

How Benton Oakfield Simplifies Life Insurance Benefits

Navigating life insurance options shouldn't consume your valuable time. At Benton Oakfield, we handle the complexity of designing and implementing benefit programs for Long Island businesses just like yours.

We help you select appropriate coverage levels, explain options to your employees in plain English, and provide ongoing support for beneficiary changes and claims. Our goal is ensuring your employees actually understand and appreciate the life insurance benefits you provide—because benefits only work when people know how to use them.

Most importantly, we're here when you need us. Whether it's helping an employee understand their coverage options or assisting with a claim during a difficult time, we provide the personal service that makes benefits truly beneficial.

Ready to explore life insurance options for your team? Contact us today to discuss how we can help you design a program that attracts talent and protects your employees' families.

Compliance Note: Benefit plan rules and tax implications vary based on company size and location. This guide is for educational purposes only. Please contact your Benton Oakfield representative to discuss how this applies to your specific situation.

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