Ways to take care of your employees

Question: I own a company that employs 30 staff. All my employees have been given group health insurance. Am I doing enough and what other key group insurance schemes are usually offered to small business employees?

Answer: One good idea is to offer group life insurance to staff within your business. However, it can be advantageous to educate your employees on the importance of owning individual life insurance to help them understand how valuable this benefit can be to them.

Group life insurance generally provides a financial provision for the loved ones that survive them, in the unfortunate circumstances of their sudden death - the cover usually ranges anywhere from Dh50,000 to one year's salary or more.

However, the amount of cover isn't often enough able to support the dependents of the deceased employee for a long period of time. This is why it is important for employees to own additional individual life insurance to protect their loved ones in case of an unexpected tragedy.

Group life insurance becomes a very helpful addition to any existing life insurance plans.

In addition, your employees should also be planning for their retirement. If not, it would be wise to advise them to meet with a financial adviser to discuss the importance of planning for retirement earlier rather than later and assessing suitable individual plans.

The premiums you pay for group life insurance packages depend on a number of variables. For example, the number of staff under your employment, their gender, average age and the type of business you operate. If you have a business where employees face hazardous conditions as part of their job, the cost for group life insurance premiums could well be higher.

There are some extended features that can be included as part of your group life insurance plan. For example, cover for the spouse and children can also be included. Instead of a fixed sum in the event of an employee's death, a sum linked to their salary for example, twice their annual salary can be included.

A further question you need to ask yourself when looking for life insurance includes what type of features you want to offer your employees as part of the group package. The reputation of the insurance company is obviously important and you should also ensure that they are licensed to conduct business in the area in which you or your business is based.

An expert independent financial adviser can assist you to understand the main points you need to include in your insurance cover and the best options to suit your budget along with other determining factors in selecting your insurer.

Small businesses have room for growth and it is wise to consider the re-evaluation of your group life insurance plan as your business continues to expand which could well include more employees to be considered.

- Nigel Watson is Sales & Marketing Director at Nexus, one of the region's leading financial advisor. Views expressed are the author's own and not necessarily reflect that of Gulf News. If you have any questions, please email : advice@gulfnews.com