In today’s workplace, supporting employee well-being requires more than reactive benefits and one-size-fits-all coverage. With financial stress on the rise and employees increasingly worried about healthcare affordability and long-term security, employers must adopt a more proactive, comprehensive approach to benefits communication. A key opportunity lies in one of the most misunderstood benefits to help employees: life insurance.

Too often, life insurance is seen strictly as a death benefit. However, many modern life policies include living benefits that support employees while they’re still alive. These can include Accelerated Death Benefit Riders (ADBRs), cash value accumulation in permanent policies, and Waiver of Premium Riders. These features offer financial protection during critical life events—such as illness, disability, or unexpected expenses—and can significantly enhance financial wellness and peace of mind.

Financial Stress Is Worsening—And Employees Need More Than a Death Payout

According to Morgan Stanley’s 2025 “State of the Workplace” study, 66% of employees report that financial stress negatively impacts their work, up 9% from the previous year. HR leaders are noticing, too—83% say financial strain among employees is harming productivity1. At the same time, younger workers are entering the workforce without adequate savings or a long-term plan. A 2025 MetLife study found that 60% of Gen Z women and 45% of men feel unprepared to manage their long-term financial future2.

Even as the job market has stabilized, employee expectations have changed, and many now look for the right benefits options for long-term security. That’s where living benefits can bridge the gap—if HR teams know how to explain them effectively.

Demystifying Living Benefits

Accelerated Death Benefit Riders are one of the most important, yet under-communicated, features in life policies. These riders allow employees diagnosed with terminal or serious illnesses to access a portion of their life insurance payout while still alive. Funds can be used for medical bills, rent, or family caregiving—all at a time when financial relief is needed most. In an era when healthcare premiums rose 5.8%3, ADBRs provide necessary liquidity for employees facing devastating diagnoses like cancer or heart disease.

Permanent life policies offer another layer of protection through cash value accumulation, which can be tapped as a tax-deferred loan or withdrawal. Whether used for emergency car repairs or education expenses, this cash value acts as a personal safety net—especially important given that 37% of Americans can’t afford a $400 emergency4.

The Waiver of Premium Rider is another lesser-known but significant benefit. If an employee becomes disabled and can’t work, this rider ensures their life insurance coverage remains active without requiring premium payments.

Why Educating on Living Benefits Matters for Employers

The employer benefits go far beyond compliance or checkbox offerings. When employees understand the full value of their life insurance policy, they feel more financially secure and supported. That emotional assurance translates directly into improved performance, retention, and morale.

MetLife’s 2025 Employee Benefits Trends study found that employees who feel “holistically well” are 67% more likely to be productive and 56% more likely to stay with their employer long-term. Meanwhile, HR Executive reports that 72% of organizations now view financial wellness as a core part of their ESG strategy, linking it directly to talent retention and workforce equity.

When employees feel holistically supported—financially, emotionally, and physically—they are more likely to be productive, engaged, and loyal to their organization. Increasingly, companies are recognizing that financial wellness plays a central role in workforce well-being and are incorporating it into broader organizational strategies. By prioritizing benefits that support employees' everyday lives, employers can foster a stronger culture of care while also strengthening talent retention and equity across the workforce.

HR’s Action Playbook: How to Educate Employees Year-Round

Despite the power of these features, most employees still don’t understand them—largely due to how benefits are communicated. Too many HR teams rely on one-time enrollment guides filled with insurance jargon. A better approach requires a year-round, multi-channel education strategy.

First, go beyond the brochure. Use webinars, brief videos, and even real-life (anonymized) stories of employees who benefited from living riders. This makes the concept more relatable. Segment messages by life stage: younger workers may be interested in cash value savings, while older employees may focus more on critical illness coverage.

Simplify the language. Replace terms like “accelerated death benefit rider” with phrases like “get money early from your policy if you get very sick.” Consider monthly reminders or Q&A office hours where benefits administrators walk employees through what’s available and when to use it.

Keep it proactive and personal. Personalized benefits statements or calculators can help employees understand exactly what’s included in their coverage. Moreover, don’t just educate during open enrollment—life events happen year-round, and communications should reflect that.

Turning a Traditional Benefit into a Strategic Asset

At a time when employee loyalty is fragile, and financial wellness is directly tied to job satisfaction, HR leaders must view benefits education as part of their larger workforce strategy. Life insurance is no longer just a “what if” policy—it’s an active tool that can offer relief during life’s hardest moments.

Educating employees on living benefits helps reimagine life insurance from a static document into a dynamic financial wellness tool. It empowers workers to make smarter decisions, relieves burdens when it matters most, and reinforces a culture of care and trust. In short, living benefits aren't just a feature—they're a reflection of the value employers place on their people, in life and in legacy.

About the Author: Hari Srinivasan is the Founder and CEO of iCover, an AI-based algorithmic underwriting platform that helps insurers sell to the middle market. By leveraging data and predictive analytics, iCover can quote, underwrite, and deliver life insurance in under 5 minutes. For more information, please visit www.icoverinsure.com.

1: https://www.morganstanley.com/atwork/articles/state-of-workplace-financial-benefits-study

2: https://nypost.com/2025/01/16/lifestyle/gen-z-already-suffering-midlife-crisis-research-finds-not-doing-well/

3: https://www.mercer.com/en-us/about/newsroom/employers-expect-third-consecutive-year-of-health-benefit-cost-increases-above-5-percent-in-2025/

4: https://www.empower.com/the-currency/money/over-1-in-5-americans-have-no-emergency-savings-research