For most, Voluntary/Supplemental Benefits are an unknown area of the insurance market. While you may see commercials highlighting animals getting money in the mail, most people still don’t understand how it all works.
Benefits to Businesses
No or low cost
Employers can offer voluntary benefits at no direct cost (i.e. 100% employee-paid), leaving them with just the cost of administration.
A way to control rising health care costs
With the cost of health care on the rise, employers are starting to move away from providing top end, ‘cover all’ primary health care benefits. Instead, they are choosing less expensive coverage and offering workers a wider range of voluntary health benefits to help fill the gaps and perhaps fin d a better overall benefit.
Attracting and keeping top talent
Employers, especially smaller businesses where key members of staff can be crucial to the success of the company, are looking for effective ways to retain their staff and recruit top talent. In fact, employee hiring and retention remains among the top five most important challenges facing business owners today.
Voluntary benefit plans help these smaller businesses compete with larger competitors by enabling access to a variety of benefits that can help them stand out in the war for talent. They can also be a useful tools in employee retention. A benefits package that an employee has chosen and tailored to their changing needs is difficult to give up.
Help with telling your staff – at no direct cost
There’s no point offering benefits if your employees don’t know about them. Communicating employee benefits can be tricky, but with voluntary benefits, some carriers will gladly help with communicating the benefit offerings to employees, either by using tried and trusted support tools, visiting the business for group meetings, or even meeting one-on-one with each employee to help review their own personal needs and best matches for benefits. These meetings may include details about what the benefit provides, a Q&A session and helping both the employer and employee with the actual enrollment process, in most cases at no direct cost to the employer.
* 77% of workers say the benefits package is an important factor in their decision to accept or reject a job.
* 88% of employees view voluntary benefits as a part of a comprehensive benefits package.
* 63% of employees say that benefits are one of the reasons they work where they do.
* In a 2014 LIMRA study 7 out of 10 employers surveyed said they offer voluntary benefits to improve morale for existing employees and to attract new talent.
* In this same study, employees who were offered voluntary benefits were 19% more likely to be satisfied with their jobs, and 14% less likely to look for a new job in the next year.
Benefits to employees
With a vast array of voluntary benefits on the market and a number of companies willing and eager to sell them, people are understandably worried about making the right choice. With their plans being offered at the workplace, employees know that their employer has vetted the carrier and considered the available benefits. Voluntary insurance also pays financial benefits regardless of any other insurance coverage employees have in place – including policies available through government health care exchanges.
The wide range of options available allows employees to choose those voluntary benefits that suit their personal circumstances and lifestyle, whether they’re 20 or 55. Many voluntary benefits are also portable, meaning that if an employee should need to switch jobs, they can continue to keep the coverage as long as they pay the premiums, making a voluntary plan easy to administer and appealing.
Bridging the gap
Voluntary benefits can complement core offerings such as life insurance or disability insurance. Even if an employer provides a core life insurance offering, employees can choose to up their life insurance coverage by adding voluntary life benefits. Voluntary benefits can also provide a financial safety net to help employees with expenses that may not be covered by their core medical plan.
As well as potentially being less expensive if purchased through their employer, voluntary employee benefits can usually be deducted via payroll – meaning there’s no need to set up bank drafts or worry about missing premium payments. Plus, pre-tax dollars are often used to pay for many voluntary benefits, meaning employees save even more money. And with most voluntary benefits paid directly to the employee, they can use the money where they need it the most.
We will continue to explore and educate on the topic of Voluntary Benefits. For more information email us @ info@TheOlympusAgency.com