What happens if you die on the job?
The circumstances of Prudhomme’s sad demise may get you thinking: what happens if I die on the job? Here’s what you need to know:
If you die at work — for instance, from a fatal slip, trip or fall, or deadly contact with workplace objects, equipment or substances — your dependents, like your spouse or your children, may be eligible to receive survivor’s benefits.
The primary mechanism most employers use to provide these benefits is workers’ compensation insurance. Your family may also be able to claim reimbursement for funeral and burial costs, up to a maximum amount provided by state law.
However, if you die of natural causes like a heart attack or a stroke in the workplace, your employer’s workers’ compensation insurance will typically not pay out death benefits unless it’s proven that the working conditions or job stress directly contributed to your death. Prudhomme’s cause of death was still under investigation at the time of writing, so it is unclear whether insurance will pay out in this case.
If your death is down to employer negligence, your dependents may be able to sue for wrongful death. In cases where work conditions might have exacerbated a pre-existing condition, there could be room for legal claims, but it’s generally difficult to prove.
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What happens to your 401(k) and other benefits
If you die on the job, any funds you’ve saved for retirement in a 401(k) account will pass on to the beneficiaries you named when setting up your account.
If anything changes in your life — for example, you get married, divorced or have a child — be sure to review your beneficiaries and bring them up to date, so the right people inherit your money.
If you have not named any beneficiaries, your spouse will automatically inherit the account.
Upon your death, the 401(k) plan administrator should reach out to your beneficiaries to offer them your account balance in one of a few ways. Their options and the withdrawal rules depend on the plan and their relationship to you. They could take a lump sum. They might be able to roll it into their own 401(k), individual retirement account (IRA) or inherited individual retirement account (IRA). Some plans may allow beneficiaries to leave the money in the 401(k) plan and withdraw it over time.
Similar rules apply for other employee benefits you might have, like life insurance.
In all of these instances, if you haven’t named a beneficiary, your assets will typically go to your estate and may end up going through probate, which can be a costly and time-consuming process.
Finally, if you’re enrolled in an employer health plan at work, your dependents might be able to "special enroll" in that plan or continue their existing health coverage for up to 36 months after your death. Per the U.S. Department of Labor, the health plan should notify your dependents of their right to purchase extended health care coverage under COBRA.
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