Insurance Benefits for Employees
Am I required to offer insurance benefits for employees?
The simple answer to this question is, no.
The only insurance you are required to provide is workers compensation insurance. Workers compensation is required in every state but Texas. Even so, many companies doing business in Texas require workers compensation as a condition for your business to do work with and for them.
We’ve covered workers compensation in other articles, but let’s give a simple explanation of it. Workers compensation protects employees who may be hurt while working, and will cover medical and rehabilitation costs and provide an income while recuperating.
In return, by having the coverage, you and the business are protected from being sued by the injured employee. Obviously, this is a very simple explanation of this very import coverage.
Employee benefits differ from workers compensation as they are elective, both by the company, and those who may or may not participate. Employee benefits are offered as part of the employee compensation package. Employee benefits for our purpose include life insurance, major medical insurance, disability insurance/short and long term, and dental insurance.
There are additional products which may fall into these types of insurance. Typically, the company may (or not) share in the cost of these insurance products and may sometimes offer them in a cafeteria style, or elective participation for some or all of the benefit insurance being offered.
Another employee benefit which may or may not be offered by the company is a 401K. There are retirement savings plans which willed be discussed in detail in later publications. They too are often provided by the insurance company who is doing the employee benefits package.
As your business grows, some type of employee benefit package should be developed to help retain and reward your good employees. Work with your licensed insurance professional for recommendations and options as your business grows. There are options and programs available for every size and type of business.