For employees, selecting which voluntary benefits they need isn’t always as simple as taking measurements for a suit or coming up with the numbers and letters they want on their license plate. Making decisions regarding health care and insurance is far more complicated. And for brokers, determining the appropriate products to offer can be a challenge. To get it done right, this decision should be taken with the same care and level of attention given to core benefits.
The likelihood of using a benefit in the near future is the No. 1 factor influencing the purchasing decision, according to a recent Sun Life Financial study.
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This begs the question: What are people most likely to use? For brokers looking to offer the customization available through voluntary benefits, what products they should offer can differ depending upon life stages.
It’s easy to underestimate one’s need for insurance when a person is young and feels invincible. Especially if without children, many might not see the need for common voluntary products such as life, accident or disability insurance.
This can be a challenging time for many young adults. For the first time, they are no longer covered as a dependent on their parents’ plans and are now responsible for buying their own insurance. Everything from health insurance, to dental, vision and auto insurance are products they might need to consider. For all these changes, it’s often worthwhile for them to talk to an advisor to gain a better understanding of the types of benefits available and how they pertain to their specific situation.
When it comes to core medical insurance, it’s not uncommon for younger adults to look at high-deductible health plans. These individuals are less likely to go to a doctor unless they have an accident or serious condition, so the high deductible isn’t as much of a worry. They also might look at health savings accounts as a way to build cash reserves for future health costs or conditions.
Life insurance can be a worthwhile investment for those at a younger age because it will likely come with lower premiums for being young and healthy. It’s also a good place to start investing money for the cash value feature in some life insurance policies. The accumulated cash values could be used as a loan for other expenses down the road.
The needs for disability and accident insurance are surprisingly important for young people to consider. In fact, one in four 20-year-olds will experience an income-interrupting disability before they retire. Despite these odds, wage earners exhibit low awareness and understanding of the need to safeguard their income. And, accidents are just that – accidents – which means they are hard to predict. It never hurts and can only help to have added protection especially for young people living an active lifestyle.