Choosing the right insurance coverage can be confusing when it comes to employee benefits. Here we will compare term vs. whole life insurance benefits to help you decide what is right for your employees.
Difference Between Term and Whole Life Insurance
As an employer, you may be wondering whether to offer term or whole life insurance policies to your employees. There are a couple of key differences between the two. Term life insurance is temporary and only pays out if the policyholder dies within the specified term. On the other hand, whole life insurance is permanent and will pay out regardless of when the policyholder dies.
Whole life insurance also accrues cash value over time, which the policyholder can access if needed. This is not possible with term life insurance. In addition, whole life insurance is typically more expensive than term life insurance. This is because it offers more coverage and protection.
Benefits of Term and Whole Life Insurance
Whole life insurance can be a good choice for people who want lifelong protection and don’t mind paying higher premiums. These policies also build up cash value over time, which can be borrowed against or used to help pay premiums if needed. However, whole life policies can be more expensive than term life policies, and the cash value may not be enough to cover the costs of a lengthy illness or funeral.
Term life insurance can be a good choice for people who want protection for a specific period, such as when they have young children at home or are paying off a mortgage. These policies are generally more affordable than whole life policies and provide coverage for as long as the policyholder needs it. However, once the term expires, the policyholder is no longer covered. As a result, some people purchase both whole life and term life policies to ensure they are protected at all stages of their lives.
How To Decide Which Type of Policy to Offer Your Employees
As an employer, there are many considerations to weigh when deciding which type of policy to offer your employees. On the one hand, you need to consider what will be most beneficial for their employees and what will attract and retain the best talent. On the other hand, you also need to balance this with the costs of offering a particular type of policy. Ultimately, it’s a decision that will come down to what makes the most financial sense for your company. As an employer, you will want to evaluate various factors, including the needs of your workforce and the policy’s overall cost. Considering all these factors, you can decide which type of policy is right for your business.
At Employee Retention Benefits, we offer a variety of life insurance plans to employers in the Pasadena, CA, area. Our term life insurance plans are designed to protect for a set period, and our whole life plans provide coverage for the policyholder’s lifetime. In addition, we offer a variety of other benefits to our clients, such as dental and vision coverage, 401(k) plans, and health savings accounts. We are dedicated to providing our clients with the best possible benefits package and are always available to answer any questions they may have. Contact us today to learn more about our employee retention benefits.
