Accidental Death and Dismemberment and Life Insurance as Fringe Benefits
Prevailing wage contractors should consider adding the Accidental Death and Dismemberment (AD & D) insurance to the fringe benefit plans they offer to their workers. Being involved in accidental death or an accident that can cause dismemberment cannot be predicted, but the stakes are higher for workers in government contracting projects.
As a responsible prevailing wage contractor, it is within your power to provide security not just to your workers, but to their families and dependents as well. You can do this by adding AD & D to the fringe benefit plans of your employees.
What Prevailing Wage Contractors Should Know about AD & D Insurance as Fringe Benefit Plans
The number of accidents leading to death and dismemberment are on the rise in the United States. This can be quite alarming, especially to prevailing wage workers that put their lives at risk. To incentivize them to continue working under such conditions, prevailing wage contractors often offer the AD & D insurance in their fringe benefit plans. Here are some things you should know about AD & D insurance in fringe benefit:
What is the Accidental Death and Dismemberment fringe benefit insurance?
People often confuse AD & D with life insurance. However, these are two separate, but related insurance items. The accidental death and dismemberment insurance is a plan that cover the loss of life, limb(s), and other severe injuries acquired from accidents. If a person with this plan dies or becomes dismembered, the beneficiary will be paid a fixed amount by the policy providers.
Life insurance, on the other hand, is purchased for a particular period of time. If a person dies within that period, the beneficiaries will receive the insurance policy. If the person outlives the time period, they can renew their life insurance policy. Usually, the AD & D fringe benefit insurance is only added as a supplemental feature in a life insurance plan.
What accidents are not covered by the AD & D fringe benefit insurance plan?
The AD & D insurance plan covers the loss of eyesight, hearing, speech, limb(s), paralysis, coma, or death of a person due to an accident. However, such injuries cannot be covered by the AD & D insurance plan if the death or injuries are caused by extreme sports, drinking and driving, war, suicide or suicide attempt, surgery, or drug overdose.
Usual Coverage of AD & D Insurance Plans
The AD & D insurance plan has several coverage options. The coverage can be for employee only, the employee and spouse, or the rest of the employee’s family. Usually, the principal sum of the benefits is payable once the loss of life, speech and hearing, or two hands, feet, or eyes have been caused by the accident.
If the accident did not cause injuries as severe as the ones mentioned above, then half or a quarter of the principal sum can be paid to the beneficiaries. Paralysis and coma are also covered by the AD & D fringe benefit insurance plan. Apart from these benefits, the AD & D insurance plan also covers surviving spouse education, day care benefit, child education benefits, and extension of coverage, among a host of other benefits.
ARCHER JORDAN Can Help Prevailing Wage Contractors Provide Fringe Benefit Insurance Plans to Your Employees
Accidental Death and Dismemberment cannot be foreseen by anyone. However, prevailing wage contractors like you can help your workers achieve a certain sense of security by providing fringe benefit plans that cover AD & D.
ARCHER JORDAN has had years of experience a fringe benefits advisor to a number of contractors doing business transactions with the government. If you want to know more about AD & D and how you can add this to the life insurance plan of your prevailing workers, contact our team now!
