Employees are increasingly viewing voluntary benefits as an important component of their overall benefits package, and participation in voluntary products is expected to grow.
That conclusion was based on “The ABCs of Voluntary,” the fourth in a series of five research briefs from The Prudential Insurance Company of America.
According to Prudential, , for 71% of employees, the offer of voluntary benefits increases the value of their company’s overall benefits program, up from 63% in 2012.
Employees report cost as the biggest advantage to the voluntary option followed by convenience and enrollment without a medical exam.
Bob Patience
“As people juggle their professional and personal obligations, the worksite offers a convenient and cost-effective way to gain valuable financial protection,” said Bob Patience, vice president, voluntary benefits at Prudential Group Insurance. “Employers who provide effective communication, education and tools as part of the enrollment process help employees evaluate their own personal protection needs and make the choices that are right for them.”
According to Prudential, the value of voluntary benefits is also recognized by employers, with over half (51%) reporting they are currently implementing or have already implemented offering more voluntary products, up from 32% in 2012.
Similar to employees, cost remains the biggest perceived advantage from the perspective of employers. For employers that have already ramped up their voluntary benefits offerings, 49% report they have been successful in achieving their desired cost savings, up from 28% the year before.
Voluntary benefits offer employers the ability to maintain a competitive and valuable benefits package in a cost-effective way, Prudential stated. The convenience of voluntary benefits along with offering employees economical options were also cited as advantages by employers.
“Employers realize that a robust voluntary benefits offering is the right thing to do for themselves and for their employees’ overall financial wellness,” said Patience.
In addition to employees and employers, brokers also expect voluntary benefits growth, with 65% expecting the demand will increase in the next five years. Other key findings include :
- Two-thirds of brokers, most employers and nearly half of employees consider the provider name an important factor when considering enrollment in voluntary plans.
- Employers are open to the idea of sharing information through a TPA to the carrier on an employee’s life event so the carrier can reach out regarding evolving benefit needs. Employees agree, with 63% reporting they would be very interested in this type of communication.
- Although benefits education and awareness activities typically occur during an annual or open enrollment period—not during specific life events—nearly half (46%) of brokers say they prefer multiple enrollment opportunities for different benefits during the course of the year outside of the annual enrollment period (off-cycle enrollment), up from 33% in 2012. Sixty-seven percent of brokers say they believe employees would probably or definitely make better benefit decisions if their life and disability insurance enrollment period was separate from their medical insurance.
“Brokers, employers and employees all express a level of desire for off-cycle enrollment opportunities. Employees can be overwhelmed by the number of products to consider during a single enrollment period. Use of targeted off-cycle enrollments allow employees the opportunity to clearly assess their needs and carefully consider the products being offered,” said Patience.
The report was part of Prudential’s Eighth Annual Study of Employee Benefits: Today & Beyond.
Participation in voluntary products expected to grow via IFAwebnews.com .
