Are your employees getting the most out of their group life insurance?

Your employees are the most important part of your business. You want to provide benefits that attract and retain talent. Providing employee benefits can not only set you apart from your competitors but can improve the satisfaction and productivity of employees. 

One type of employee benefit to consider is group life insurance. Positives for the employer - it is generally a low cost add-on to your companies group benefits package. Concerns for employees - is it enough coverage to help themselves and their families if needed?

Employers can provide a few options to their employees to increase their coverage beyond the basic group life:

Optional Life Insurance

 Optional Life Insurance allows employees to contribute beyond their group life plan to increase their coverage. This option can be available to the employee and sometimes extended to their spouse. This extra contribution is paid by the employee and may have a medical exam requirement.

 This can be presented to your employees as an option to give them more comprehensive coverage beyond their basic group life plan. Employees can have peace of mind they have protection and, in most cases, have the option to change over to an independent plan if their employment status changes.

Non-Evidence Maximum (NEM) vs Health Evidence Maximum (HEM)

Non-Evidence Maximum (NEM) applies to insurance type benefits and refers to the maximum amount of coverage an employee can receive without a medical test or questionnaire. Health Evidence Maximum (HEM) also applies to insurance type benefits and is the maximum amount of coverage an employee can obtain only after submitting a medical questionnaire. HEM coverage is only provided for those who have their medical evaluation approved by the insurance carrier.

Simply put, NEM is the maximum coverage an employee can be covered under regardless of their health and HEM is the maximum they can be entitled to after being approved.

The most important aspect of HEM is the employee must apply and be approved before any serious health ailments happen. If they develop a serious illness and then apply for HEM they will be denied.

Employees do not have to apply for HEM, they can remain at NEM if they choose. The employer just needs to let the employees be aware of this opportunity and make them aware they need to apply before any serious health issues occur. It is recommended employees be reminded of this opportunity by their employer annually and the employer should keep documentation they have informed their employees of this benefit.

It encouraged that employees are being educated on how they can maximize their group benefits. The more empowered with knowledge they are, the more secure they can feel. It’s also important to talk to your group benefits advisor to ensure you have the best plan for your business and employees.