No Load Life Insurance

Fatalities can occur in any workplace. Even sedentary positions have their risks, be it from traffic incidents, homicides, falls or even being struck by an object. Although employers are required to have workers compensation coverage, personal life insurance is not mandatory. Even if an employer does provide a group policy, individuals should still seek additional coverage to cover for all events and for the appropriate amount.

What are the most dangerous and hazardous jobs?

According to the Bureau of Labor Statistics, there were 5,071 work related fatalities in 2008. Specifically by industry, occupation and event, the highest were:

By industry:

Construction

• With 969 fatalities (19% of all deaths) – this sector had the most fatalities in 2008

Natural Resources and Mining

• 826 fatalities (16%)

Transportation and Warehousing

• A total of 762 deaths (15%)

Agriculture, forestry, fishing and hunting

• There were 651 mortalities (13%)

By Occupation:

• Motor Vehicle Operators – 908 fatalities (18%)
• Construction trades workers – 720 deaths (14%)
• Management positions (other than top executives and operations specialties managers) – 480 in total (9%)

By Event:

• Transportation incidents – 2,053 (40%)
• Contact with objects and equipment – 920 (18%)
• Assaults and violent acts – 794 (16%)
• Falls – 680 (13%)

Among those considered to be the most dangerous professions include pilots, oilmen, commercial fishers, loggers, farmers, sanitation workers, coal miners, roofers, millers, electrical power line installers and repairers, fire-fighters, police, patrol officers, oil and gas drillers, taxi drivers, truck drivers, construction equipment operators, animal slaughterers, security guards and iron/steel workers.

For insurance purposes, a job is considered dangerous based on a fatality rate. It’s the ratio of deaths as compared to the total number of employees in the profession.

What happens if I die at work?

All employers must carry workers compensation insurance, even those of hazardous occupations. Depending on the state, if you die as a result of injuries at work, your dependents are generally entitled to weekly benefits and/or a lump sum payment. The benefit payments will depend on your income, the number of dependents you have and the date of injury which caused your death.

Usually, the benefit amount is not sufficient. For example, in California the total compensation payable can’t exceed $125,000 for one dependent, $140,000 for two dependents and $160,000 for three or more dependents. The insurance company will pay burial expenses up to $5,000. This is why many workers purchase additional insurance to cover their family’s needs in the event of a death.

Generally, proceeds can only be claimed by those who were actually dependent on you at the time of your death and who are related to you. In California, the dependent must be your spouse, child, parent, brother, sister or grandchild. Definitions of “spouse” and “dependent” can be complicated and vary between states. The onus is on the claimant to prove they were dependent on you for financial support, totally or partially.

Problems can surface if you have dependants from different families. If there is a dispute, an appeals board will make a decision as to who gets the death benefits and whether they are paid directly or held on trust.

Group Insurance Provided by Employers

Some employers provide Accidental Death & Dismemberment (AD&D) coverage for their employees. It’s important to remember that this insurance only applies to non-work related accidents. If you die at work, workers compensation will apply. If your fatality is not work-related and accidental, benefits are paid from the AD&D insurance. The benefits paid are in addition to any life insurance held by the worker. The policy does not cover death from natural causes or illness.

AD&D only applies while you are still employed by that employer. Once you leave the job, you will no longer be covered by that policy and you cannot convert it into an individual one.

Even if you have workers compensation and AD&D, you should still have your own life insurance policy to ensure:

• You have coverage if you die of illness or natural causes;
• Your family is covered for the right amount (what they will actually need to live on and pay debts in the event of your demise).
• You still have insurance if you leave the job. If you become terminally ill, without having an individual policy in place, you may be found uninsurable and without any coverage.

Getting Life Insurance with a Hazardous or Dangerous Occupation

Your own personal coverage is not mandatory even in a hazardous occupation. Employees can combine life insurance in pension plans. However, this not required and doesn’t effectively differ from obtaining your own life policy.

Insurers consider your profession during the underwriting process when determining your mortality risk. Depending on how dangerous your work is, you may be denied cover even if you are in excellent health. If you are given a policy, you will certainly be charged higher premiums due to the greater risk. The cost can even double.

For this reason, it’s especially important to compare rates with insurers. You may even be able to reduce premiums by taking safety classes or getting licensed (reducing the risk for your insurer).