The employee doesn’t want to be part of the benefit plan. They have coverage elsewhere.”

Can employee’s waive off benefits when
they have alternate coverage?

Yes, but not ALL coverage.

On a typical benefit plan, an employee MUST be enrolled for the Life, AD&D, Dependent Life (if they have dependents), Short and Long Term Disability (as applicable).

An employee can only waive off the pharmacy, health, vision and dental care when and only when they have spousal coverage elsewhere. Employee’s spouse is NOT coverage for life or disability under the benefit plan. These are income related benefits and employers do not pay non-employee spouses a wage.

Allowing an employee to completely decline all benefit coverage has serious ramifications for the employee, their family and ultimately the company for which they are employed.

Let’s use an example of an employee who has declined full coverage assuming that they were completely covered under their spouse. Now that spouse has lost their coverage for one reason or another and they want to be on this benefit plan. The insurance carrier will not allow this without ALL family members completing an evidence of insurability questionnaire. The insured underwriter reserves the right to decline coverage. If all members of the family are approved for coverage, some of the benefits approved will still have first year limitations.

Let’s take this same scenario one step further and assume the same employee who declined this coverage incurs a disability. What now? This employee has no ability to replace their wage as they assumed they were covered under their spouses plan (which they can not be). They will not approach their spouse’s employer for this coverage; however, they will approach their own employer and request to now be on the plan.

As they were not listed for coverage under the plan—no premiums were paid—they do not exist for the insurance carrier. The employer has now assumed the role of the insurer, risk and liability for any and all claims arising as a result of this employee’s death or disability.


Providing benefits to an employee group demands 100% participation from all of
your employees.

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