“The economy is growing and leaving some people behind,” Carey Anne Nadeau, Co-CEO and Co-founder of Loop Insurance, stated.
The cost of living is more expensive than many wages grant. Transportation to work can cost what some make that day. And it’s nearly impossible to afford city life, but living in suburban or rural areas excludes residents from job opportunities when they don’t own a car. It’s crystal clear: Minimum wage jobs do not provide a livable wage, and it’s up to employers to find viable solutions that help those who are being left in the dust.
One way to do so? Offer car insurance as a benefit. “Responsible employers will look for ways to subsidize the cost of living,” Nadeau explained, “so that they can continue to have their employees show up at work every day.” Paying for expenses is not a new concept. Employers have been subsidizing costs from health insurance to cellular data for a while now, and adding car insurance to the equation will not only allow both parties to save money, but will work to help people in low-wage jobs find stability and opportunity.
Ride along with Loop and Carey Anne Nadeau as we tell you why subsidizing car insurance is cost-effective, smart, and will benefit everyone.
Subsidized Car Insurance Acts as an Incentive to Attract Employees
In Nadeau’s original research on the affordability of public transportation, she found that for many commuters, the price of public transit was eating away huge sums of their earning salary. “In the case of Denver International Airport, there are premiums on public transportation costs that can make it $11 to get to the airport,” she explained. “For a minimum wage worker earning $7.25 an hour, you're giving up three hours of pay just to get to and from work.”
This added cost will undoubtedly deter people from the position, specifically those without cars who will be taking public transportation. By subsidizing some of all of your employee’s car insurance, you are not only making the purchase of their own vehicle more feasible for them, but finding a more cost-effective way for them to get to work, making it worth their while.
“It’s an attraction tool,” Nadeau said. Rather than just upping someone’s salary, employers can attract talent by offering creative benefits, such as car insurance. “It’s a meaningful thing that employers can use to incentivize folks to come work for them.”
Retain Workers so Commuting Isn’t an Obstacle
Paying for employee’s car insurance isn’t just an attraction tool; It’s a retention tool as well. Without access to a car, people are more likely to have to miss work, to be unable to return to work after rushing home for a family emergency, or even to continue working while raising children at home.
“People end up dropping out of the workforce because it's simply just not feasible for those in a one car household to share cars, or in a no car household to use public transportation, and be available for the day to day of, your kid gets sick at school and needs to go home from school,” Nadeau explains. Paying for your employee’s car insurance will help their commute, and your business, run more smoothly.
Losing workers due to their lack of mobility isn’t just a problem for the employees but the employers as well. Training and hiring new employees is expensive, so aiding in transportation costs as a way to retain current employees is a smaller price to pay. “You want to keep good folks,” Nadeau said. “One way to do it is to offer them benefits like paying for their car insurance.”
Car Ownership Affords More Opportunity
As Nadeau previously emphasized, the economy is leaving valuable workers behind. For example, people living in low-income neighborhoods who don’t own a car have significantly less economic and professional opportunities available to them. A commute can be the difference between having and not having a career. Vehicles can significantly hinder vocation.
According to research by Adie Tomer, a Senior Research Analyst at the Brookings Metropolitan Policy Program, 7.5 million households in the United State’s largest metropolitan areas don’t own a car. Using public transit, these 7.5 million households are able to reach over 40% jobs within 90 minutes. However, this still leaves many jobs out of reach for zero-vehicle households,” Tomer finds.
Paying for employee’s car insurance isn’t just the difference between owning a car, it’s the difference between the potential for an ongoing career. “Car ownership is really important for people who are living in lower income neighborhoods,” Nadeau emphasizes, “to be able to not only get to and from a job, but also get to and from a quality job that affords them the opportunity to prosper.”
This is One Way to Ensure Employees are Paid the Living Wage
The Living Wage is a number that determines how much workers in low-wage positions must earn to ensure that they can meet the standard of living based on their particular location and needs. Ensuring that all employees are paid a living wage is a crucial commitment to be made, but doing so does not need to mean increasing all workers salaries by a certain amount.
Aside from childcare, transportation is the largest cost that goes into the living wage. So, rather than adding dollars to a paycheck, employers could pay for parking, for transit, and of course, for car insurance.
“Can we pay some or all of your car insurance, so therefore your take home income ends up being higher?” Nadeau suggested. “So that you can afford good food, or child care, or for college or for your kids?” These are all needs that no one deserves to sacrifice. Paying workers the Living Wage is simply essential, but how employers do so can be done creatively.
How Loop is a Part of the Conversation
Loop was created with a simple goal in mind: to make owning a car accessible for all. To do so, Loop revolutionized the car insurance process, so that prices weren’t based on unfair and prejudiced measures, like credit score or zip code. With the help of employers ready to create opportunities for their employees and better stability for their companies, Loop can bring fair and inclusive car insurance to more worthy drivers.
For employers excited about this mission, contact Loop at email@example.com to set up a custom program for their employees.
The economy may be leaving people behind, but Loop will always offer a ride. First stop? Car insurance benefits.