Group lifeinsurance doesn’t come across as a very exciting product, partlybecause it’s so familiar to employers and employees. (Photo:Shutterstock)

Group life insurance is one of the most commonbenefits offered by employers. When asked about the importance ofbenefits in a 2018 LIMRA study, employees rated life insurance onlybehind medical benefits, paid vacation and retirement plans. In the samestudy, a survey of employers indicated they think employees rank life insurance lower than theydo. Perhaps these employers are taking life for granted.

Related: 3 reasons life insurance is essential to anybenefits package

Group life insurance doesn’t come across as a very excitingproduct, partly because it’s so familiar to employers andemployees. Employers know employees want to provide financialsecurity to loved ones. Basic group life insurance providessufficient money to cover basic final expenses. Providing fordependents’ future financial security expands the need andamplifies the amount of necessary coverage. That’s where term andpermanent voluntary life insurance provides a great solution.

Marty Traynor is vice presidentof voluntary benefits at Mutual of Omaha.

It seems unlikely that group life is being overlooked, but let’slook at the facts:

• In a recent LIMRA study, 17 percent of employersindicated they plan to drop group life insurance as a benefit. Theoverall number offering group life insurance was down 14 percentbetween 2006 and the 2018 study.

• When LIMRA surveyed employees, they underestimatedboth their risk of dying before retirement age and the amount ofinsurance they need. Only 56 percent of workers even understandthat the money from life insurance can be used for any purpose,while just 45 percent realize that life insurance purchased at workis generally portable if they change jobs or retire.

• In a separate study, LIMRA found 58 percent of allemployees have insufficient life insurance to cover their familyneeds.

Employees clearly need further education, yet employers areplacing less emphasis on it. Perhaps we are part of the problem. Wetend to treat group term life insurance as a commodity, focusing onprice instead of employee needs.

Many employers think voluntary life eligibility needs to bematched to eligibility for employer-paid plans. Since employersoften have valuable part-time employees, why not make them eligiblefor voluntary life, even if they’re not eligible for the employerpaid plan?

Second, most group life plans and voluntary group life plansdon’t require death of the insured for benefits to be payable. Mostgroup plans allow acceleration of the death benefit in the event ofa terminal illness, and many accelerate benefits in situations likeinability to perform activities of daily living.

Third, the guarantee issue amounts available in voluntary termlife plans have increased steadily and evidence of insurabilityprocesses supporting employee buy up plans have been simplified.Access to guarantee issue and easy buy up options take much of thepain out of shopping for and buying life insurance. Everyemployer’s plan should be reviewed accordingly.

Fourth, while online enrollment can be beneficial, there’s nosubstitute for the human touch. Employees need guidance inunderstanding the value of their benefits. This need for educationduring the enrollment process presents an opportunity for employersand their advisors to provide value to employees and theirdependents.

Let’s stop taking life for granted.

Read more:

• How to reach today’s potential life insurancebuyers
• Americans aren’t buying life insurance, butwhy?
• 5 uses for life insurance most people haven’tthought of