What is wrong with these people?

Today’s Wall Street Journal published an article about the widespread practice of businesses privately taking out life insurance policies on their employees with themselves as the beneficiaries. Chances are if you work for a big corporation and are at least a mid-level manager that there is a life insurance policy on you, too. If you die, the company takes the payout from the policy. While today’s article is mostly about policies taken out on executives, there has long been a (thankfully) controversial practice of so-called “janitors insurance,” that needs no explanation. What is wrong with these people? In addition to the death benefit, the businesses also receive a tax-deduction for the premiums that they pay. What does the employee receive in exchange for volunteering for this arrangement? Nothing. What is wrong with these people?

It truly boggles the mind, but let’s try and enter the heart of darkness here and contemplate the kind of mindset that someone has to be in to think such practices do not cross an ethical line. Hmmm. It strikes me that businesses have an old physicists’ view of the Universe – that each part of the Universe is a cog in a deterministic machine. How else can you justify secretly placing insurance policies on people?

The current practice is less onerous than the notorious “janitors insurance” because many of the insured have knowledge that a business has insured their lives. In fact, many of the policies are mini-pension plans for the executives that are insured because the cash values can be tapped by some of the executives. So it’s not as bad as the above scenario, unless you consider…

That the benefits of these policies should benefit all employees, not just executives. Shouldn’t that be obvious? What is wrong with these people?

Soap box dismounted.

Peeved,

Jason

PS – My book is currently before various publishing houses, it is tentatively entitled: A Radical Guide to Investing: Modern Alchemy. Keep your fingers crossed for me that it get’s published. It will hopefully result in an uptick in blog traffic that will make this an even more vibrant forum. Hurray!