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Comment by patio11 | Hacker News Reader

He's pointing out (correctly) that this is an entirely cosmetic abstraction layer on top of life insurance. It's like saying "And in addition to your salary, we're also giving you a roll of quarters every month in case you need to pay tolls, do laundry at one of those barbaric laundromats not in the Googleplex, or play arcade games." "So what you're saying is you're giving me $10 a month extra in salary?" "No no, what we're saying is we're giving a roll of quarters..."

Pro-tip for HNers here, by the way: Notice how you responded much, much more viscerally to this emotional, novel perk than you would have if Google had described it as an industry-standard perk with a knob slightly adjusted? Please remember this the next time you're e.g. writing a pricing plan or feature grid.

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When it boils down to it, every perk is an entirely cosmetic abstraction layer over money. The company spends money, and employees save money.

The interesting perks are the ones that save the employee more than money. Free food does more than save employees from spending money on brown bag lunches or fast food joints: it saves employees from having to even think about how they'll eat lunch. Shuttle service? It doesn't just save employees the money they'd spend commuting, it saves them time and the frustration of dealing with traffic or public transportation.

In that sense, a survival benefit like this isn't just the company throwing a few extra dollars for life insurance at employees. It's not just saving employees money, it's saving employees from the pain of having to concern themselves with how their surviving dependents will get along. They don't need to see a doctor for a physical to get this benefit. They don't need to calculate their number of expected children, multiply by their expected college expenses in a decade, figure in the remaining cost of their mortgage, the time it will take their spouse to find employment, etc. in order to put a number of how large a life insurance policy they need to take out; they can simply rest easy knowing that their dependents will be taken care of for a decade or longer and not give it a second thought.

The survival benefit Google offers in addition to industry-standard life insurance is only "an entirely cosmetic abstraction layer" in the most uninteresting of ways.

(Disclaimer: I'm a software engineer for Google, but these opinions are entirely my own.)

We are in total agreement that sane defaults and benign paternalism can create value; I'm just interesting in the marketing. (P.S. Only mentioning because it is not obvious given the sociopolitics of American engineers: I am not using "paternalism" as a crypto-criticism.)

> When it boils down to it, every perk is an entirely cosmetic abstraction layer over money.

That's only sort of true. What large corporations offer in addition to things that can be abstracted as money is collective bargaining / purchasing power.

The important inequality is that there's not fundamental equivalence between a dollar spent by Google and that dollar given to an employee to be spent on the same aim. Real benefits, as opposed to those which are simply redirected salary, are those where the corporation leverages its collective power to obtain a significant discount or make possible things which would otherwise be unavailable.

Google can in bulk buy insurance policies that might even be wholly impossible for individuals to acquire at any reasonable price point. Certainly there are some benefits (insurance or otherwise) that would not be reasonably available to individuals to buy a la carte.

This, however, is probably not one of them. Extra life insurance benefits are probably something that could rather easily be rolled up in a standard life insurance policy. That said, Google probably does get more bang for their buck than the average consumer would.

Large companies aren't the same as individuals when it comes to insurance. If you have enough employees, and you're covering an relatively small risk, you don't need to /buy/ anything at all. You just self-insure and you save a ton of money relative to what an insurance company would charge for the same coverage.

I've worked at several large companies where almost all of the insurance (health, life, etc) was done on a self-insured basis, with an insurance company providing providing administrative oversight (validating claims) for a flat fee. (But not actually providing insurance coverage.) If necessary, a company can buy reinsurance to cover claims above some (very, very high) deductible, the same way that your insurance company does.

And the reason why large companies do this is that, in fact, they do get a lot more bang for the buck than any of their employees could as individual consumers.

Why do they not need to worry about the number of children? If you have more than two kids, they can burn through half a salary in college tuition easily.

This is exactly what life insurance is. Death benefit: 5x salary total, payable in ten annual installments. Anybody worrying about their future does need to worry if 5x salary is going to be a sufficient amount.

... in which case they would buy more insurance. This benefit from Google is additive to existing benefits (including life insurance, which as mentioned is free up to certain limits and can be bought for additional amounts), and does not replace those benefits. So if you opt to not have ANY life insurance and instead depend solely on Google's stated 5x salary death benefit, then, yes, that's not enough. But this benefit is not meant to replace life insurance, but rather to augment it.

The article also said that all children would receive $1k/mo until 19 (or 23 if a full-time student).

> "And in addition to your salary, we're also giving you a roll of quarters every month in case you need to pay tolls, do laundry at one of those barbaric laundromats not in the Googleplex, or play arcade games."

... is it just me or would this be an incredible perk? If a roll of quarters and an envelope with $250 worth of $1, $5, and $20 bills were delivered to my desk every month I'd save a lot of time going to the ATM or the laundromat for tips/laundry/cash-only restaurants/etc. I think I'd willingly give up a lot more of my salary than it's actually worth for the convenience of perks like that. Free laundry (like, full wash and fold and dry cleaning)? Shit, for that I'd probably take a $95K job over a $100K job (all other things being equal) even though it's really worth ~$1000 at most (comparing against the cost of laundry services, not machines, of course). Does Facebook still have that?

If a roll of quarters and an envelope with $250 worth of $1, $5, and $20 bills were delivered to my desk every month I'd save a lot of time going to the ATM or the laundromat for tips/laundry/cash-only restaurants/etc. I think I'd willingly give up a lot more of my salary than it's actually worth for the convenience of perks like that.

OK. Give me your postal details, pay me $1000 per month, and I can organise that for you.

You sound almost sarcastic there, but I'm guessing you respond in earnest?

I think I may have been slightly exaggerating about trading 5K a year in income for free full service laundry, but I was mostly serious :)

This benefit is probably not taxable until you actually die and the spouse gets the money, whereas contributions to life insurance are likely considered taxable income during life.

> He's pointing out (correctly) that this is an entirely cosmetic abstraction layer on top of life insurance.

Life insurance is provided by extremely conservative, highly diversified investment companies.

> Notice how you responded much, much more viscerally to this emotional, novel perk ...

Yeah, with nausea that employees are expected to gamble something so important on ... AdSense.

Life insurance is provided by anyone willing to pay your survivors a death benefit.

Yeah, like Enron or Lehman Brothers or General Motors.

The point is that betting on your employer is a bad idea when it comes to insurance products and especially annuities. If you want your kids to have financial support if you die, you owe it to them to buy policies from more than one conservative insurance company. The whole point of insurance is to defray risk, not get a handsome payout.

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