Highlight: Financial Safety and policies related to the protection of the financial interests of the employees are an important duty of the human resources team. A thriving company is born of happy and stable employees. Achieving these goals is crucial in the wake of the pandemic.
A healthy person with a sustainable income has the confidence to go about in his life. When faced with hurdles, he navigates through all difficulties easily.
Such a utopian outlook is contradicted mainly by the workers’ situation in the real world. Employees worrying about money is not healthy for a thriving workspace. Inevitably, this stress reduces morale, community engagement, and overall job performance. A study in Economic Times reveals how 40% of employees are stressed about unexpected expenses.
Employees require assistance in this area, and organizations that embrace a duty of care are more likely to retain their brightest employees. Relaxation rooms and flexible working hours aren’t the only aspects of employee health programs. They must put in place pragmatic strategies to assist employees in protecting what they have, providing people with much-needed peace of mind.
The effect of the pandemic on work-life has taught us the significance of financial wellness and employee well-being. 63% of employees have stressed how their financial worries have increased since the pandemic struck. In the wake of a new year, it is also essential to focus on protecting the interests of the employees and assuring financial safety and security.
Benefits of financial protection
Employers of financially fit employees benefit from the following:
- Productivity gains– Staff is less distracted and better able to keep focused on company goals.
- Reduced stress– Related illnesses and absenteeism, such as substance abuse, on- and off-the-job accidents, and tardiness are significantly reduced.
- Lower HR expenditures– Fewer wage garnishments, pay advance requests, and reliance on assistance programs.
- Minor theft– Though deliberate theft is a different matter, theft motivated by desperation, such as “borrowing” money to make ends meet until the next payday can be avoided.
- Improved capacity to interact and collaborate successfully with coworkers is increased, as well as following supervisory instructions.
Types of Financial Protection
Let us look at forms of financial protection that employers must look into.
Employees with dependents require a lot of life insurance. This financial safety net assures that individuals left behind will have enough money to live comfortably. Life insurance provides families with a financial safety net through difficult times, and it could mean the difference between preserving or losing a family home.
Income Protection Insurance
Providing income protections ensures that employees are covered by income protection insurance if they lose their jobs due to illness, accident, or injury. Millennials are the generation most likely to demand income protection, according to a 2019 FT Financial Adviser article.
Critical Illness Cover
Critical illness insurance protects employees in the event of severe sickness or disability as a result of an accident. Upon diagnosis of various illnesses, this type of financial protection often pays out a lump sum (strokes, heart attacks, cancer, etc.). Employees can utilize payouts to pay off debts or mortgage payments that they might not otherwise be able to afford while unemployed.
Private Medical Insurance
While a well-equipped public healthcare system is efficient for dealing with emergency medical situations, access to private services is a helpful resource. There’s nothing wrong with looking for ways to cut down on hospital wait times when someone falls seriously sick. Access to more medical resources and a greater range of expert therapies is something private medical insurance can provide.
Having access to private medical insurance may allow employees to return to work sooner due to quick treatment – a win-win situation for both the employer and the employee.
Will and Estate Planning
Wills and estate planning can help loved ones to cope with the weight of sudden deaths. While it may appear challenging to discuss wills and estate planning with employees, it is a crucial type of financial protection that should be considered and discussed with the workforce. We never know when the worst can happen, but putting plans in place can help families deal with stress and disagreements.
Statistics mentioned in a study prove how such policies are favored across all employees. Across all age groups, 17% of individuals believed such measures were beneficial, while 13% preferred collective critical illness policies.
In the same study, we see how 17% of persons who intend to work past 65 and believe group income protection would be the most beneficial benefit translates to almost 4 million workers, but only 2.5 million presently receive such benefits from their workplace.
It is safe to say that financial protection and stability are necessary and protecting crucial to boosting a company’s morale and growth. Read more such informative blogs at EarlySalary.