Millennials have been considered the youngest generation in the workplace for many years, but the reality is the oldest millennials are 36 years old, and many are beginning to start families. While starting a family can be exciting, it also can be financially challenging. The USDA reported that parents should expect to pay roughly $233,610 to raise a child until they are 17 years old.
This number is based on basic expenses for things like health care, food and education. The number doesn’t account for the unexpected expenses associated with accidents or chronic illnesses. These types of unanticipated medical expenses can be financially crippling for a young family. A 2015 Federal Reserve System survey showed that 22% of the participating individuals experienced a major unexpected medical expense that they had to pay for out of pocket in the prior year. Forty-six percent of those who said they had a major medical expense reported that they currently owed debt from that expense.
With the increase in employer-sponsored high-deductible health plans, gaps in medical coverage are becoming increasingly more common, requiring employees to pay larger sums out of pocket. However, these gaps can be reduced through the purchase of voluntary insurance benefits. Not only do voluntary products provide coverage for working parents, but they also are designed to provide coverage for children.
To demonstrate to your clients’ millennial employees how voluntary insurance can help compensate for these coverage gaps, consider how you can focus on the family protection aspects of accident and critical illness insurance in your sales this year.
Protecting the Family
The need for additional financial protection will catch the attention of most millennials, but particularly those who have little ones in daycare, school and extracurricular activities. To help make the need for voluntary insurance realistic for millennial parents, I’ve found it can be helpful to use decision support tools, or at least real-life scenarios of how benefits are paid.
Interactive decision support tools help employees understand the need for certain coverages by providing employees with a personalized experience or recommendation. These decision support tools communicate the need for these products in short videos or claims examples.
For instance, a claims example about an accident insurance product could use a child’s sports injury to highlight what benefits an employee would receive. The example would provide information on the type of expenses incurred — deductibles, coinsurance, travel expenses — and then provide the actual dollar amount paid under the accident plan. Decision support tools often have a variety of scenarios for employees to select from based upon their own personal concerns or situation. This type of education can help highlight the importance of accident and critical illness coverage for millennials who may have devalued voluntary benefits previously.
Preparing for the Accidents
Whether minor or catastrophic, accidents can happen to anyone. But not everyone is prepared to handle the costs associated with medical treatment and recovery following a child’s accidental injury.