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Does your boss want you dead?

MaggieD

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'Dead peasants' insurance pays your employer a secret, tax-free windfall when you die. Insurers have sold millions of policies to companies such as Dow Chemical.
By Liz Pulliam Weston

Right now, your company could have a life insurance policy on you that you know nothing about. When you die -- perhaps years after you leave your employer -- the tax-free proceeds from this policy wouldnt go to your family. The money would go to the company. Whats more, the company might use this policy to pay for retirement benefits and other perks not for you or your fellow workers, but for your companys top executives.

--snip--

Companies pay a whopping $8 billion in premiums each year for such coverage, according to the American Council of Life Insurers, a trade group.

The policies make up more than 20% of the all the life insurance sold each year.

Companies expect to reap more than $9 billion in tax breaks from these policies over the next five years. The policies are treated as whole life policies. So, companies can borrow against the policies (though the IRS won't let them write off the interest). And the death benefits are tax-free.

Does your boss want you dead? - MSN Money

Is there anything wrong with this?
 

tacomancer

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At my plant, we have a mandate from the CEO to fix at least 5 safety issues a month. So we are probably wanted alive. I could be wrong though ...

However, I do see a potential for abuse in the sense that it might create perverse incentives for some companies to not worry about potential problems. Thank goodness for OSHA, even if they do go too far sometimes.
 

MaggieD

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At my plant, we have a mandate from the CEO to fix at least 5 safety issues a month. So we are probably wanted alive. I could be wrong though ...

However, I do see a potential for abuse in the sense that it might create perverse incentives for some companies to not worry about potential problems. Thank goodness for OSHA, even if they do go too far sometimes.
You'd never know, Mega. These policies are bought without the knowledge of the 'peasant.'
 

Johnny

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I don't even see how this is legal. I just saw an episode of CSI Miami about that. I thought it was fake for the show. That's messed up.
 

Your Star

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I remember hearing about these in Michael Moore's last movie, and they were talking about how the broker was upset because profits were down because not enough people were dying. It's really sickening.
You can't take out an insurance policy on someone else's house, because you have an invested interest in their house being destroyed, so why should they be able to do this?
 
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spud_meister

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if my boss killed me, he wouldn't be able to get any of the stuff he keeps more than 5 foot above the floor :mrgreen:
 

Harry Guerrilla

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'Dead peasants' insurance pays your employer a secret, tax-free windfall when you die. Insurers have sold millions of policies to companies such as Dow Chemical.
By Liz Pulliam Weston

Right now, your company could have a life insurance policy on you that you know nothing about. When you die -- perhaps years after you leave your employer -- the tax-free proceeds from this policy wouldnt go to your family. The money would go to the company. Whats more, the company might use this policy to pay for retirement benefits and other perks not for you or your fellow workers, but for your companys top executives.

--snip--

Companies pay a whopping $8 billion in premiums each year for such coverage, according to the American Council of Life Insurers, a trade group.

The policies make up more than 20% of the all the life insurance sold each year.

Companies expect to reap more than $9 billion in tax breaks from these policies over the next five years. The policies are treated as whole life policies. So, companies can borrow against the policies (though the IRS won't let them write off the interest). And the death benefits are tax-free.

Does your boss want you dead? - MSN Money

Is there anything wrong with this?
They do have an insurable interest in your life.

It costs money to replace a worker, usually more than their yearly wage.
Just saying, it isn't as bad as it sounds.
 

Harry Guerrilla

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At my plant, we have a mandate from the CEO to fix at least 5 safety issues a month. So we are probably wanted alive. I could be wrong though ...

However, I do see a potential for abuse in the sense that it might create perverse incentives for some companies to not worry about potential problems. Thank goodness for OSHA, even if they do go too far sometimes.
I think you know pretty well, through all the safety meetings they have, that employees are the primary cause of all accidents in the work place.

We hired a new guy about 2-3 weeks ago.
He was running a press and decided it would be easier and faster to switch the selector to foot peddle activation, instead of hand control activation.

He bent over to put a part in the press with his hands, not with the safety tool and accidentally stepped on the foot peddle.
He lost 3 fingers.

That costs the company $10k per finger ($30k), not to mention work mans comp and short/long term disability benefits.
It was his fault for violating safety rules but the company has to pay.

If he had died, his family could of sued, which involves more expenses.
It is completely legitimate for companies to insure against loss for employees.

Saying they want you to die is hyperbolic and shows a complete lack of understanding, for why they do this (not saying you're doing this).

OSHA has very little to do with this stuff, they were created in the 70's by Nixon, way after work place safety become an important thing for employers.
 
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MaggieD

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They do have an insurable interest in your life.

It costs money to replace a worker, usually more than their yearly wage.
Just saying, it isn't as bad as it sounds.
These policies stay in effect long after someone has left the companies' employ. Insuring a 21-year-old woman without her knowledge for $450,000 will cost a company $130/month. HSBC Insurance

Hell, I'd like to do that. What a great way to build wealth. $130/month for average life-span of 65 years = $101,400. Magically becomes an absolute MINIMUM of $450,000. With cash values, etc., it would probably be worth much more. And if the insured was a multiple-offender for drunk driving, heck, increase the policy to a million.
 

MaggieD

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I think you know pretty well, through all the safety meetings they have, that employees are the primary cause of all accidents in the work place.

We hired a new guy about 2-3 weeks ago.
He was running a press and decided it would be easier and faster to switch the selector to foot peddle activation, instead of hand control activation.

He bent over to put a part in the press with his hands, not with the safety tool and accidentally stepped on the foot peddle.
He lost 3 fingers.

That costs the company $10k per finger ($30k), not to mention work mans comp and short/long term disability benefits.
It was his fault for violating safety rules but the company has to pay.

If he had died, his family could of sued, which involves more expenses.
It is completely legitimate for companies to insure against loss for employees.

Saying they want you to die is hyperbolic and shows a complete lack of understanding, for why they do this (not saying you're doing this).

OSHA has very little to do with this stuff, they were created in the 70's by Nixon, way after work place safety become an important thing for employers.
As I'm sure you're aware, companies already have this covered under their Workers' Comp insurance.
 

Harry Guerrilla

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These policies stay in effect long after someone has left the companies' employ. Insuring a 21-year-old woman without her knowledge for $450,000 will cost a company $130/month. HSBC Insurance

Hell, I'd like to do that. What a great way to build wealth. $130/month for average life-span of 65 years = $101,400. Magically becomes an absolute MINIMUM of $450,000. With cash values, etc., it would probably be worth much more. And if the insured was a multiple-offender for drunk driving, heck, increase the policy to a million.
These policies have traditionally be sold in 10, 15, 20, and 30 year terms.
Probably a paper work catch up that hasn't happened.

Even when the employee leaves, how does the company know when they die?
They aren't exactly friends forever.

As I'm sure you're aware, companies already have this covered under their Workers' Comp insurance.
Work mans comp doesn't cover litigation costs from wrongful death lawsuits.
It doesn't cover the costs of replacing the employee either.

I read someone that on average it costs a business $60k to hire a new employee.

Besides all that, what does it matter, if it doesn't hurt you?
 

MaggieD

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These policies have traditionally be sold in 10, 15, 20, and 30 year terms.
Probably a paper work catch up that hasn't happened.

Even when the employee leaves, how does the company know when they die?
They aren't exactly friends forever.



Work mans comp doesn't cover litigation costs from wrongful death lawsuits.
It doesn't cover the costs of replacing the employee either.

I read someone that on average it costs a business $60k to hire a new employee.

Besides all that, what does it matter, if it doesn't hurt you?
It bothers me. I don't think a corporation should be adding to its bottom line because a janitor dies. Key Man Insurance is something I understand and I think it's an entirely different thing. I don't think even that kind of insurance should be allowed without the key man knowing about it...and getting some benefit from it.

If the janitor knows about it . . . it he receives some benefit from it . . . no harm-no foul. But doing it on the down-low seems unethical to me.
 

Harry Guerrilla

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It bothers me. I don't think a corporation should be adding to its bottom line because a janitor dies. Key Man Insurance is something I understand and I think it's an entirely different thing. I don't think even that kind of insurance should be allowed without the key man knowing about it...and getting some benefit from it.

If the janitor knows about it . . . it he receives some benefit from it . . . no harm-no foul. But doing it on the down-low seems unethical to me.
The benefit is largely an offset of costs associated with dealing with the death of an employee.
In the cold realistic sense, it costs a lot of money sometimes.

My companies carries insurance for me and my benefit, at no cost to me.
I'm sure they probably carry insurance in case I die as well.

I'm a share holder, so it comforts me to know that my share value will be held, even after I die.
Mainly because my family will benefit.
 

MaggieD

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The benefit is largely an offset of costs associated with dealing with the death of an employee.
In the cold realistic sense, it costs a lot of money sometimes.

My companies carries insurance for me and my benefit, at no cost to me.
I'm sure they probably carry insurance in case I die as well.

I'm a share holder, so it comforts me to know that my share value will be held, even after I die.
Mainly because my family will benefit.
Can't argue with a guy who sees nothing wrong with it if it's happening to him....
 

MaggieD

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I'm not being an ass.

Just saying there are legitimate reasons for it.
My work environment can be very dangerous, especially when you have dumb asses as employees.
I wasn't being facetious -- and I knew you weren't being an ass. I can't even quite put my finger on it why it bothers me, and I'm not usually at a loss for words. Ha!
 

Harry Guerrilla

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I wasn't being facetious -- and I knew you weren't being an ass. I can't even quite put my finger on it why it bothers me, and I'm not usually at a loss for words. Ha!
Let me give you another example.

A couple of months ago, at one of the local paper mills, a pregnant woman got caught in a mill machine.
She along with her baby died.

Now the company can't not hire her because she is pregnant, nor can they fire her.
At the same time, the company is 100% liable for both her and her baby, that she and her boyfriend created by their choice.
Even if she is 100% the cause of her own death.

No doubt a wrongful death suit will come from both, the death of the woman and the baby.
Companies have to insure against stuff like this.
 

d0gbreath

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These policies stay in effect long after someone has left the companies' employ. Insuring a 21-year-old woman without her knowledge for $450,000 will cost a company $130/month. HSBC Insurance

Hell, I'd like to do that. What a great way to build wealth. $130/month for average life-span of 65 years = $101,400. Magically becomes an absolute MINIMUM of $450,000. With cash values, etc., it would probably be worth much more. And if the insured was a multiple-offender for drunk driving, heck, increase the policy to a million.
This wouldn't work. In 65 years, $450,000 would only be worth $4,500.
 

molten_dragon

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I don't have a problem with it as much as some people seem to, but I do feel that the companies that take insurance policies out on their employees should be required to inform those employees about it before they're hired. That way, the employee can choose not to take the job if it bothers them that much.
 

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It puts a damper on going to work if you know that you are worth more to your boss dead than alive.
 
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