Employee benefits and business insurance should not be looked at in a vacuum.

History: A Beacon Group client had set up their employee health insurance plan with a 90-day waiting period for new hires. Several months after the initial set up, the client’s sales manager hired a new rep who had specifically indicated that he needed health insurance benefits from day one with no waiting period. The sales manager agreed to offer the rep a position with health insurance coverage from day one. The insurer processed the application and mailed the new hire his ID card with the effective date of coverage listed as 90 days from the date of hire, as was established when the plan was set up. The employee threatened to sue the employer for misrepresentation and hold them responsible for any/all costly health claims he had already begun to incur as a result of his medical condition.

Result: As a Beacon Group client, their liability insurance included employee benefits liability rider and would be covered in this situation. Employee benefits and business insurance should not be looked at in a vacuum.