Irrespective of how long one stays with an organisation, certain benefits such as a life insurance go beyond the employment term and stay with the person even after they’ve quit.
With the talent scenario becoming more challenging, organisations today do not hesitate to go that extra mile to ensure they are able to retain the best of their people. While work profile, growth prospects on the job and compensation have always been perceived as the most critical aspects that determine people’s interest and loyalty towards an organisation, the trend is now changing. Quirky and innovative employee benefits and perks are taking centre-stage, as multi-generational workforces and newer lifestyles are emerging.
Some of the benefits that organisations nowadays offer to their employees even exceed the scope of employment. Irrespective of how long employees stay with an organisation, certain benefits, such as a life insurance, can go beyond the employment term and stay with them even after they’ve quit. Why should any organisation provide benefits that the employees will enjoy even when they’re not part of the organisation anymore? Why offer additional insurance benefit when most organisations already provide health and accident insurance to their employees?
The following points will answer these questions and explain why life or term insurance is a relevant and meaningful employee benefit.
Added tax benefits for the employee
As per income tax laws, the maximum amount that can be claimed as deduction under section 80C is Rs 1,50,000 and for this exemption, section 80C lists several investment options, including premium paid for a life insurance policy as one.
A life insurance pays a lump sum amount to the designated beneficiary, in the event of death. As an employer, life insurance is a really meaningful benefit to offer to your employees, especially those with families or children.
Although, for millennials, paid vacations and overtime pay may appear as more lucrative benefits, the tax benefit is still a major pull for most people to take up additional insurance policies apart from the one health insurance their employer offers. Hence, it makes sense for the employer to support the employee in getting the best possible options for the same. Since, it is a benefit that people will anyway take up or invest in, employees will feel more cared for if the organisation helps them find a more convenient way to do it.
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Easy to administer
What makes a life insurance a safer bet in terms of the complexities involved in such things, is the fact that it doesn’t require any constant monitoring or control on the part of the employer. Also, it generally doesn’t generate frequent claims, unlike other health or accidental insurances. So, ultimately, despite being a must have from an employee perspective, it is a no fuss and easy-to-offer employee benefit from the employer’s perspective.
Health is wealth but life is everything
While health insurance is one of the most common and also the most expensive benefits that organisations provide, it may not be enough. Health is extremely important, but ultimately it makes sense only until one is alive. Death is unforeseen and inevitable and hence, most people, especially those who are the breadwinners for their family, go all out on their own and opt for a life insurance plan, which will benefit their family later.
Most people take it up separately from insurance companies, while their organisation only provides a health insurance. Now, taking cue from this, organisations can just help secure the future of their staff by tying up with a third-party provider who will simplify and support the process of getting a suitable life insurance policy and even help reduce the amount of premiums to be paid.
While the employers do not really pay for the insurance in this case, the employees get to benefit through the tie-ups as they enjoys lower premiums and eased out process formalities. Without having to spend a lot, organisations can make their employees feel valued by offering more convenient insurance facilities. This way, it’s a no cost, no risk win-win for both the employees and the employers.