The Importance of Insurance in a Company and How You Can Apply It to Yours

employees smiling

Employee benefits are crucial if we want to keep our employees to work for us. It’s one of the most consistent employee benefits found in many companies. However, as a starting entrepreneur, you might not see the benefits of having it. Moreover, you might not know the kind of insurance you should be giving to your employees. Don’t worry. The fundamentals of insurance are more accessible than you think.

The insurance industry is a trillion-dollar industry that works with companies to give their employees cheaper and more affordable policies. It’s estimated that more than half of insurance policies in the US come from employer arrangements. Additionally, it is mandated that every significant company offer insurance to their employees, as stated by the Affordable Healthcare Act (ACA).  But what kind of insurance is vital to employees?

Kinds of Insurance Essential to Employees

Insurance is vital to employee retention, but what kind of insurance should you exactly offer your employees? A survey has found that one of the essential benefits for employees is health care, followed by retirement and future planning benefits. These two benefits are part of medical and life insurance policies.

Specifics are essential when you’re negotiating with your insurance provider. For example, you must cover checkups, accidents, and common medical operations in your policies regarding medical insurance.

Medical Insurance

One of the essential things that employee medical insurance should cover is checkups. We’re not just talking about general checkups but specialized checkups that look into the body. Procedures such as endoscopy, x-rays, and ultrasonography are examples of common medical examinations that people undergo once or twice a year. There is a good chance that your employee will require these tests, and your insurance should cover payment for it.

Accidents should always be included in medical insurance as well. Millions of Americans experience accidents in their lives. Most of these accidents lead victims to hospitals. The bills from these accidents tend to be very expensive. A three-day stay in a hospital averages at a staggering $15,000 in the US. This is why your medical insurance should cover accidents.

Lastly, medical insurance should also cover medical operations such as surgeries. It’s hard to find an insurance company that fully covers specialized surgeries, but many cover common surgeries in the US, such as appendectomy. Your medical insurance should at least cover the most common surgeries to ensure that it won’t burn a hole in your employees’ pockets.

Life Insurance

Life insurance covers all sorts of retirement benefits, including estate distribution once the policy-holder passes away. Retirement benefits include a robust 401(k) plan, investments, and hospice care. Estate distribution means that the policy-holder should be given a chance to make a will. If your policy does not cover these two, make sure it does.

Not many employees are given a chance to have their own financial advisors, but if your company has the funds for it, then make sure you can give them one, especially if you have only a few employees working in your company. These financial advisors will make investments more robust. Here are a couple of investment options that are meant for retirement savings.

stock prices



Some life insurance plans offer stocks as part of their retirement savings plan. Index funds are the safest choice, and insurance companies know this. But because the ROI might not be as huge, some insurance companies mix in reliable blue-chip stocks such as Amazon and Microsoft into the mix. Stocks accumulate money over time, and although they might not be the most reliable investment, they can be great for your employees.


Many insurance companies offer bonds as their prime retirement savings plan. It’s much stabler than stocks and can earn a decent ROI. You can never go wrong with an insurance provider that offers this kind of investment as a rider in their life insurance plan.


Not many life insurance companies offer this kind of investment in their retirement savings plan, but those that do, tend to be high-end insurance companies. We don’t suggest this investment for your employees, but we certainly suggest it for you.

How these investments work depends on the policy-holder. It depends on how much of their premiums go into future investments. If your employee wants to increase their investments beyond the average value given by your insurance provider, let the employee talk to the insurance provider instead.

So here are the most crucial insurance policies your employees should have if you want them to continue working for your company. These are robust choices for employee retention, especially if you add the investment options to the mix. You don’t have to worry about increasing their pay because it’s up to them how much their pay goes into their investment. Try these insurance policies for yourself and see your employee retention rate increase over time.

Like & Share

About The Author

Scroll to Top