Voluntary benefits are becoming increasingly beneficial for employers and employees, as the Affordable Care Act has created financial challenges around benefits, and the ACA is expected to contintue creating higher demand for voluntary benefits in the coming years. In fact, a 2013 Towers Watson survey estimates the percentage of employers that consider voluntary benefits to be an important piece of benefits packages will increase an astounding 228.5% by 2018.
Employers are looking for economical ways to improve employee engagement and be seen as employers of choice, and voluntary employee benefits present a good opportunity. Common voluntary benefits including disability, life, vision and accident, critical illness and hospital indemnity are quickly becoming some of the most sought after benefits as gap programs seek to round out core medical coverage. These are logical and beneficial extensions of consumer-driven health plans that give employees an extra level of protection without adding costs to employers.
"The Seventh Annual Study of Employee Benefits: Today & Beyond" by The Prudential Insurance Company of America shows that 63% of employees surveyed say their employer’s voluntary benefits increase the value of their benefits programs. In addition, 34% percent of employees say they want more voluntary benefits through their employer, in comparison to 24% in the previous year.
Prudential Group Insurance Vice President of Voluntary Benefits Bob Patience says paying for voluntary coverage through payroll deductions and access to education, communication, and tools for informed decision-making give employees many advantages to improve and protect their financial security.
Voluntary benefits provide peace of mind for employees dealing with rising health care expenses in a tough economy. With many having challenges meeting deductibles and out-of-pocket medical expenses, voluntary benefits provide a safety net.
Patience emphasizes that voluntary benefits create value for employers by creating more employee satisfaction with benefits programs. Almost half of all voluntary benefits brokers anticipate increased demand in the near future, with the biggest increases in critical illness insurance for coverage that pays a lump sum for specific conditions such as cancer, heart attack, and stroke surgery. Other voluntary benefits expected to be in demand include accident insurance, long and short-term disability, dental, and life insurance.
Employers, especially small and mid-size employers, increasingly see voluntary benefits as a way to economically improve their employee benefits packages to attract and retain the employees they need.
Healthcare Reform Magazine reports that the future of voluntary benefits offerings will include better communication, coordination, and grouping of voluntary benefits to provide more value. Voluntary benefits will expand with new products in response to demand and competition. Employers want to help their employees deal with financial and health stressors that affect productivity and business success in the convenient and cost-effective way provided by voluntary benefits.
The drive toward consumer-driven health care is also driving the desire and demand for voluntary benefits. Health care reform has jostled the world of brokers and employers and created more choice and challenges than ever, for employers and employees alike. Employers will continue to provide benefits to attract employees, and employees will have a bigger role in choosing and managing those benefits, especially voluntary benefits. Currently, these benefits can be accessed through a multitude of carriers, including Aflac, Colonial, Prudential and MetLife, but as demand increases, more variety and lower costs for voluntary benefits will evolve even more, creating a win-win for everyone in health coverage.
To find out more about how voluntary benefits can save you and your employees money and increase benefits and retention, contact PAYDAY today.
PAYDAY Workforce Solutions provides a single database SAAS solution for Human Capital Management (HCM) including payroll, human resources, time management, benefits administration and onboarding to companies of all sizes and in various industries.
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