Workplace Benefits Overview
Many employers, in addition to health insurance and a retirement plan, offer their employees a suite of what are often called workplace benefits or voluntary benefits. These benefits can make employees’ lives easier in the event of a serious illness or injury.
What are they?
Work benefits are a suite of benefits that offer employees a backstop to fill in gaps in their health insurance coverage and their retirement savings. These benefits usually are meant to help in special situations, such as a disability that prevents a person from working.
Who are they for?
Work benefits are a good idea for all employees to consider. Not every employee may need each benefit offered, but it is a good idea to consider them because you never know when you might need extra help. Some of these voluntary benefits can be especially important for people who are the main or sole breadwinner in a household, because the benefits can work as income replacement for a short period of time.
How do they work?
Work-related benefits are meant to provide a cushion in times when people are in a crisis caused by an accident or illness. Many of the benefits pay a one-time lump sum if you are injured or become seriously ill and can’t work. Others may provide ongoing payments. You usually pay the premiums for these voluntary benefits yourself with deductions from your paycheck.
There are a whole host of workplace benefits that companies may offer, but a few are among the most common. Disability insurance pays you either short- or long-term compensation if you are hurt or become ill and can’t work. Accident insurance and critical illness insurance both pay you a lump sum if you if you are hurt in an accident or if you are diagnosed with a serious illness. Long-term care insurance provides coverage in old age for nursing homes. Universal life insurance is a type of cash-value life insurance.
The main benefit of having voluntary benefits coverage is that you have extra coverage beyond your health insurance and retirement savings for events in life that could leave you unable to work.