Accident Insurance: A key component to overall financial wellness

The increased popularity of high-deductible health plans coupled with the shift by some employers to a defined contribution model for health care benefits may impact the financial wellness of millions of Americans who may not be prepared to manage their out-of-pocket medical and non-medical expenses in the event of an unforeseen accidental injury. According to a new white paper published by the Prudential Insurance Company of America (Prudential), “Accident Insurance: Helping employees cope with out-of-pocket non-medical and medical expenses stemming from accidental injuries,” in order to combat this vulnerability, many employers are offering a broader array of benefits that can ease the financial burden of their employees.

Accident insurance, a voluntary or employer-paid benefit designed to complement existing medical and disability insurance benefits, is one such benefit that can help employees cover out-of-pocket medical and non-medical expenses should an accident occur.

“In the evolving benefits landscape, accidents can easily become not just medical events but also significant financial events,” said Bob Patience, vice president, voluntary benefits, Prudential Group Insurance. “With many Americans more active than ever before, the need for accident insurance becomes greater and greater.”

And, it is not just extreme sports that leave Americans accident prone. According to 2012 National Safety Council statistics, about 540,000 bicyclists visited the emergency room in 2010 with biking-related injuries. Falls, motor vehicle accidents, and playground injuries also play prominent roles in injury-related emergency room visits.

Accident insurance can play an integral role in helping employees cover related expenses. By providing a payment to claimants that can be used to cover out-of-pocket medical and non-medical expenses, accident insurance, as part of a healthy benefit mix, works to help ensure the overall financial wellness of employees.

Besides the obvious benefit of financial relief should an accident occur, the flexibility of many accident insurance plans, the simplicity of having it offered through the workplace, and the option of payroll deduction for premium payment, renders accident insurance an attractive option for many employees.

Employers also benefit by offering accident insurance in their benefits line-up. More robust benefit packages can improve employees’ satisfaction with their jobs while also leading to improved productivity by alleviating financial stresses employees may take with them to the workplace. Also, companies anticipating a move to a high- deductible health plan may help ease the transition for employees by additionally offering more voluntary benefits.

Despite the growing use of accident insurance, one of the main obstacles to widespread adoption in offering this benefit is awareness, according to the white paper.

“Overall, there needs to be a concerted effort to increase the awareness of the importance of accident insurance,” said Patience. “Employers are still not fully aware of its benefits, and employees generally have a low level of awareness as well. This should serve as a call to action for the benefits industry to work together to highlight the importance of this benefit.”

For more information on financial wellness and the role accident insurance plays in a comprehensive financial wellness strategy, visit www.prudential.com/financialwellness.

Prudential Group Insurance manufactures and distributes a full range of group life, long-term and short-term disability and corporate and trust-owned life insurance in the U.S. to institutional customers primarily for use in connection with employee and membership benefit plans. The business also sells critical illness, accident, accidental death and dismemberment and other ancillary coverages and provides plan administrative services in connection with its insurance coverages. Group Insurance coverages strive to facilitate protection from risks that are difficult to predict, thus fostering overall financial wellness for employees and their families.

Prudential Financial, Inc. (NYSE:PRU), a financial services leader, has operations in the United States, Asia, Europe and Latin America. Prudential’s diverse and talented employees are committed to helping individual and institutional customers grow and protect their wealth through a variety of products and services, including life insurance, annuities, retirement-related services, mutual funds and investment management. In the U.S., Prudential’s iconic Rock symbol has stood for strength, stability, expertise and innovation for more than a century. For more information, please visit http://www.news.prudential.com/.

Group coverages issued by The Prudential Insurance Company of America, 751 Broad Street, Newark, NJ 07102. Prudential, the Prudential logo, and the Rock symbol are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide.

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