Published by Trustmark Voluntary Benefits on April 1st, 2021

Putting a co-worker’s office supplies in Jell-O or hiding your significant other’s car keys may have made for some harmless fun on April Fool’s day but, when it comes to insurance, it’s not quite as much fun when things don’t turn out as expected. To help make sure you aren’t fooled by common misconceptions about insurance, we’ve compiled several ways you may have the wrong idea about your options for protection.



“My medical insurance will cover my healthcare needs.”
More than 50 percent of employees are enrolled in a high-deductible health plan, which the IRS defines as a minimum deductible of $1,400 for single people or $2,800 for families.1 Simply put, this means most employees’ insurance is not going to cover everything. That’s why voluntary benefits can be a critical piece of the puzzle; to help them bridge the gaps in coverage.

“I can’t afford additional insurance.”
Of course, it’s easy to say to an employee “add voluntary benefits”, but money is always a factor. The good thing is, it’s actually more affordable than they probably think. The average American spends $19 a week on coffee but, for less than that amount, they could potentially purchase supplemental accident insurance, life insurance or any number of coverages to round out their insurance needs.2

“I have life insurance through work, so I’m covered.”
Life insurance is a crucial piece of an employee’s financial plan. As it stands, there exists $15 trillion of unmet life insurance need in America3 Chances are, even if an employee has life insurance through their employer, they’re underinsured. Over 60 percent of employees have either no life insurance or less than the recommended coverage amount. Most life insurance from employers is one or two times an employee’s annual salary, but industry experts generally recommend life insurance coverage that is five to seven times their salary.4

“I don’t need Disability insurance because of Social Security Disability Insurance (SSDI) and worker’s compensation.”
Disability income insurance can be overlooked because employees think they have alternatives through SSDI and worker’s compensation. The truth is, that workers compensation only covers incidents at work and 70 percent of applications for SSDI are denied.5 Disability insurance can pay regardless of where the injury occurred and employees can adjust the policy to their needs to make sure they have enough coverage.

Everyone enjoys a good prank on April Fool’s day. And, while insurance companies and employers certainly are never trying to mislead consumers, the truth is that insurance can be tricky to understand. Misconceptions are to be expected. That’s why it’s so important to stay informed. That way, the biggest surprise they’ll have to worry about is a rubber snake in the bathtub on April Fool’s day.
 
1 Lending Tree. Value Penguin. “51% of U.S. Workforce Enrolled in High-Deductible Health Plans, Which May Leave Some Underinsured.” 2021.
2 MSN Money. “Do You Spend More Than the Average American on 25 Everyday Items?” 2019.
3 Benefits Pro. “The $15 trillion unmet life insurance need and how to solve it.” 2017.
4 Benefits Pro. “Life insurance: Not enough have it, and many don’t have enough.” 2020.
5 Disability Benefits Help. “Top 5 Reasons Why Disability Claims are Denied.” 2018.