GROUP LIFE BENEFIT: WHAT IT ADDS PER EMPLOYEE AND PER HOUR.
Basic group life is one of the cheapest items in a benefits package. The Bureau of Labor Statistics reported life insurance at $0.05 per hour worked across all private industry in March 2026, about 0.1 percent of compensation. That is a national average for all industries, not construction, and your own number comes from your carrier's rate sheet. The cost is a rate per $1,000 of coverage per month, times the thousands of coverage, divided across the hours the employee is paid. Coverage above $50,000 has a tax rule attached, and life insurance the owner buys personally or for a buy-sell agreement is a different thing with a different purpose.
The cost is small enough that the owner can decide it from the cash side. This page explains what the benefit is, how carriers price it, what it adds to the labor burden, what the $50,000 tax line is, and how it differs from key person and buy-sell life insurance.
WHAT IT MEANS.
Employer-paid basic group life is a death benefit the company buys for its employees under one group policy, set as a flat amount or a multiple of pay, and priced by the carrier per $1,000 of coverage per month.
A licensed broker or benefits advisor places the policy and explains the plan terms. This page is about the money: what the benefit adds to a payroll and to an hourly rate. Plan rules, tax rules and state law differ, so check the details with the plan advisor and a tax professional.
Group life is usually bought with accidental death and dismemberment coverage, called AD&D. Life coverage pays when the employee dies from almost any cause. AD&D pays only when an accident causes the death, and it also pays a set amount for listed injuries such as the loss of a limb or sight. AD&D is usually an add-on to life coverage and is quoted as its own small rate. Construction is a trade where the accident side of the benefit is easy for employees to understand, so many owners look at both together.
HOW GROUP LIFE IS PRICED AND PAID.
What the employer is buying
Basic group life is one policy that covers every eligible employee. The benefit is set in the plan as a flat amount, such as one amount for every employee, or as a multiple of annual pay, often with a maximum. If an employee dies while covered, the carrier pays the beneficiary the employee listed on the enrollment form. The employer pays the premium and the employee usually pays nothing for this basic layer. Many plans let employees buy more coverage at their own cost, and that extra layer is outside the employer's burden.
Priced per $1,000 per month
Carrier rate sheets quote group life as a monthly premium per $1,000 of coverage. The rate is listed by age band, and rates rise as the age band rises. AD&D is quoted as a small separate rate per $1,000. Some carriers give a lower schedule to lower risk industry classes, and a carrier decides how it classifies a contractor. Rates differ by carrier, state, year and group size, so a rate seen online is not your rate. The cost on the bill is the rate times the thousands of coverage, summed over every covered employee.
Age, headcount and participation
Because rates rise with age, a crew with an older average age costs more per $1,000 than a young crew. Carriers also set rules for the group: how many employees must be enrolled, and how much coverage an employee can get without health questions. That no-questions amount is called guaranteed issue, and it often depends on how many eligible employees the company has. Employer-paid plans and employee-paid plans are treated differently on these points, and carriers vary, so the broker confirms the rules in writing before the plan starts.
Coverage above $50,000 and the tax line
The IRS generally lets an employer exclude the cost of up to $50,000 of employer-provided group-term life coverage from an employee's wages. For coverage above $50,000, the IRS figures a cost from a table of monthly cost per $1,000 by age bracket, and that amount is taxable to the employee, reduced by anything the employee paid toward the coverage. This is a tax rule and not a plan rule, and it has exceptions, so the owner asks the tax professional how the plan is reported before setting a benefit above $50,000. The IRS table cost and the carrier's bill are two different numbers.
Life insurance for employees versus life insurance for the owner
Group life pays the employee's beneficiary and is a payroll benefit. Life insurance the owner buys personally pays the owner's family, and it is bought with the owner's own money or paid by the company as compensation. Life insurance bought to fund a buy-sell agreement or to protect the company if an owner or key person dies pays the company or the other owners. These are three different purchases with different payers, beneficiaries and tax treatment. Only the first belongs in the labor burden. The key person page covers the second and third.
Prevailing wage work
Life insurance is on the list of fringe benefit types in the federal Davis-Bacon rules. Credit toward a required prevailing wage needs a bona fide plan that is legally enforceable and not already required by other law, and the plan rules are set by the Department of Labor. Whether a given plan counts is a question for the plan advisor and the contract, not a rule to assume.
WHAT IT LOOKS LIKE IN DOLLARS.
Take a flat $50,000 benefit. Assume a combined life and AD&D rate of $0.12 per $1,000 per month, an invented round number and not a quote. 50 thousands of coverage times $0.12 is $6.00 a month, or $72 a year. Divide by 2,080 paid hours and the benefit adds about $0.035 an hour, three and a half cents. If the same group were older and the combined rate were $0.40 per $1,000, the cost is $20 a month, $240 a year and about $0.115 an hour.
With 20 covered employees at the $6.00 a month in the first example, the premium is $120 a month and $1,440 a year. On $6M of revenue that is 0.024 percent of revenue. Compare that with the national figure: BLS reported $0.05 per hour worked for life insurance in all private industry in March 2026, which is near the example. The number to use in a bid is the one on your own carrier invoice.
A benefit set at one times annual pay costs more for a higher paid employee. At the same $0.12 rate, an employee paid $80,000 a year has $80,000 of coverage, so the cost is 80 times $0.12, or $9.60 a month. That is $115.20 a year, about $0.055 an hour on 2,080 hours. A flat amount gives every employee the same cost. A multiple of pay moves the cost up with each raise.
WHAT WE CHANGE.
SPM takes the monthly group life and AD&D premium from the carrier invoice, spreads it over the paid hours of covered employees, and adds it to the burden rate. Bids are priced with that rate so the benefit is paid by the job and not by the overhead account. See the labor burden page.
SPM compares the carrier's monthly bill to the list of active employees. Premiums billed for employees who left, or a new hire missing from the bill, are raised with the broker before the next payment.
Life insurance the owner owns personally and any policy that funds a buy-sell agreement are recorded separately from the employee benefit. SPM asks the tax professional how each one is booked, so a cost that belongs to the owner stays off the jobs.
Group life is one line next to health, dental, vision, disability and retirement. SPM totals the lines per employee per month and per hour so the owner sees what a hire costs before the offer is made. See the true cost per employee page.
FLAT MONTHLY FEE. NO SURPRISES.
Three tiers, priced by your trailing twelve month revenue. Which one you're in depends on how much of the work you want off your desk. No hourly billing. No payroll. The one-time onboarding fee is right here in the table.
| Last 12 months revenue | Monthly fee | One-time onboarding |
|---|---|---|
| Up to $1M | $1,900 to $2,900 | $1,000 |
| $1M to $3.5M | $2,600 to $3,900 | $1,500 |
| $3.5M to $6.5M | $3,800 to $5,700 | $3,000 |
| $6.5M to $9.5M | $5,100 to $7,100 | $4,500 |
| $9.5M to $12.5M | $6,100 to $8,500 | $6,000 |
| $12.5M to $15.5M | $7,400 to $11,000 | $7,500 |
| $15.5M to $18.5M | $9,400 to $13,500 | $9,000 |
| $18.5M+ | Quoted individually | Quoted individually |
The onboarding fee covers migrating your books back to the start of your last taxable year and getting you fully operational in 60 days. It's billed once, with your first invoice. It's the same for all three tiers. Your first month is prorated, and your monthly engagement starts on the first of the first full month.
Range reflects the three tiers below. Which one you're in depends on how much of the work you want off your desk. No payroll. No hidden line items. The onboarding fee is right here in the table.
You stop guessing.
You get the CFO work. Job costing built against the way you estimate, a 13 week cash forecast, monthly WIP, and a meeting every month that ends in decisions and never in a report.
Your bookkeeper still does the books.
You stop touching the books.
Everything in Core, and we do the bookkeeping and the controllership as well. Your office stops answering coding questions and stops fixing a reconciliation that will not balance on the last day of the month.
We do the books. No payroll.
Every job shows its margin while it is still open.
Everything in Executive, plus the job costing and WIP platform set up, loaded with your cost codes, and managed for you every month. You never have to learn it.
We do the books, the job costing, and the software. No payroll.
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