Of Budgets and Benefits

For a while now, I’ve had a Google Alert set up for “Employee Benefits” that sends me a daily digest of news and web activity related to our profession. While the number of articles and items may vary from day to day, there has been noticeable increase in the quantity and quality of the content landing in my Inbox.

In the past, alerts generally had just a few items a day, mostly filled with dry trade announcements or scholarly research. But starting back in January, on some days the alerts have contained dozens of items, most of them a reflection of the sharp debate taking place across the country as local municipalities and state legislatures grapple with budget deficits by squeezing costs at every level–including the benefits that public employees get, and how much they contribute to their benefits plans.

An apt metaphor

I’ll leave the politics for the pundits, but it struck me that these budget crises at every level, up to and including our national debt, provide an apt metaphor for insurance.

We keep hearing that, if we don’t get our finances in order and address our debt, our kids aren’t going to have the same standard of living as we had.

It occurs to me that that’s also true of the protection we provide. If a wage-earner doesn’t have sufficient insurance to protect against the setbacks caused by illness, a disability or even death, his family may also face a dramatic change in their standard of living.

But getting to the point where a budget is balanced, or a family is protected, is not a fun or exciting process. Government officials would no doubt rather spend money on tangible things that constituents can see, and workers–especially those on tight budgets–may have what seem to be better uses for their weekly paychecks.

But life and disability insurance policies are ultimately long-term commitments that help people protect a portion of their earnings and/or assets so that their loved ones are protected against future financial hardships.

The protective mindset

Society today seems more and more geared toward instant gratification, which makes it tough to get people in a mindset of protecting themselves. Just as the national conversation is turning toward the tough choices and sacrifices we may have to make, perhaps the conversation with employers and employees should focus on understanding the risks to employees and their families of not being sufficiently insured, and giving employees a plan to deal with it.