Paid parental leave insurance is a new financial product, but it is a game-changing employee benefit and potentially an untapped opportunity for brokers, agents and advisors.
how does that work?
Employers with 25 to 5,000 employees have their companies complete a census that is used to generate estimates for paid parental leave insurance coverage. This census includes things like employee age and gender.
Employers must also select policy details. For example, when an employee takes parental leave, do they want to replace her 60% or 100% of the employee’s weekly salary?Do they want the benefits to last 6 weeks, or do they want them to last 16 weeks? do you want
If you like what the quote says, you can go ahead and purchase paid parental leave insurance. All employees are covered by this policy regardless of whether they smoke, have health problems, or are expected to have children soon. Employers pay a monthly premium just like any other type of insurance and there is no cost to the employee.
when an employee – Male or Female – If you are taking parental leave for maternity, adoption, or foster care, your employer must submit a claim. Employees continue to receive paychecks while on parental leave, and employers are reimbursed by carriers up to $2,000 per employee per week.
Even if your employer already offers paid parental leave as a benefit to its employees, you can still purchase paid parental leave insurance and be reimbursed in the same way.
Now that we’ve explained how paid parental leave insurance works, let’s talk about why this insurance coverage/employee benefits are ready to take off.
The next section also discusses conversations advisors can have with employer clients regarding paid parental leave insurance.
Missing previous options
One reason paid parental leave insurance is a great opportunity for benefits advisors is that other options are limited at best.
At the federal level, the United States is the only developed country without paid family leave. We have the Family Medical Leave Act (FMLA), which is an unpaid program that protects jobs, but not the income that makes work rewarding.
At the state level, 11 states and Washington DC We offer a unique paid family leave program. So not only are there 39 states that don’t offer paid family leave, but paid parental leave insurance can actually complement a small number of state-based programs.
For example, California-based employers can purchase policies with 50% income replacement benefits that are typically more affordable than 100% income replacement benefits. This benefit can supplement California-based programs and replace approximately 50% of your weekly income.
Outside of the public paid family leave program, not much is happening on the private side. that’s all 25% of US workers Paid family leave is available through your employer.
It’s no exaggeration to say that the market for selling paid parental leave insurance as an employee benefit is untapped. This may not be true for him in 5 years, but someone who wakes up early gets the worms.
The scarcity of paid parental leave is a stand-alone selling point, but it is also the basis for a strong conversation with employers interested in purchasing this employee benefit.
Recruiting and retaining top talent
With paid parental leave in short supply in the United States, employers who purchase paid parental leave insurance can quickly differentiate themselves in the never-ending race to recruit and retain the best workforce talent. I can do it.
Ever since the pandemic brought a remote work culture and massive resignations, there seems to have been a shift in the balance of power between employers and employees. There are more jobs than employees, and employees are using this power to get the most out of their current or future employers. Companies that don’t offer the best and most up-to-date employee benefits are losing their most coveted talent.
With only 25% of employees having access to paid family leave, what better way for employers to differentiate themselves than by offering paid parental leave insurance as an employee benefit? A In fact, Unum 86% of millennials were found to be less likely to quit if paid parental leave was offered.
Employers who introduced paid parental leave insurance early should benefit from it. They are instantly upgraded as a potential landing spot for employee talent unlike any other company.
This can be a very effective selling point when talking to employers about paid parental leave insurance.
meaningful benefits
Paid parental leave insurance not only makes employer-clients a more attractive destination for talent, it really benefits employees as well.
It’s hard to think of bad employee benefits. Most of them serve a useful and purposeful purpose. That said, it’s fair to say that some benefits make more sense than others.
Like Summer Fridays when the office closes at 3:00 p.m., an employee-paid lunch once a week is great. But could any of these make more sense than paid parental leave insurance? Employees can take months off work to care for a newborn or young child and still have food. You can rest assured that your salary will continue to cover your food, diapers, and everything else.
A survey of 1,000 working women between the ages of 18 and 44 found that 74% would have no cash savings left if they had to keep working. unpaid maternity leave 8 weeks.
Employers with paid parental leave insurance can prevent the above from happening to their employees. This is the strongest selling point of all.
Mike Brown is Communications Director at Breeze, a leading online income protection company.
