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September 30, 2006 at 08:00 PM
More and more employers are recognizing that voluntary benefits allow them to enhance their benefits offerings and provide employees more choices without incurring significant additional expenses or administrative burdens.
As we approach the fall benefits open enrollment season, workplace demand for voluntary benefits is stronger than ever. According to the 2005 MetLife Employee Benefits Trend Study, roughly one-third of all employees would like their employers to offer more voluntary benefits.
Driving employees’ growing appetite for these products is the desire for convenience. They often view protection and savings products that they purchase at work and pay for on their own more favorably than they do products that they buy independently. According to the survey, they cite “the convenience of payroll deduction” (63%) and the ability to “sign up for insurance without going through medical exams” (48%) as particularly important.
Interest varies by life stage
Young families express a stronger interest in voluntary benefits than do their peers. MetLife found 44% of employees with children under 6 want a broader range of voluntary offerings at the workplace, compared with 34% of employees overall. Among singles, boomers and pre-retirees, roughly one-third of employees in each of these groups want access to a broader range of voluntary benefits.
Like employees, employers favor voluntary benefits for their convenience and ease of administration. Of the employers surveyed, 33% view voluntary offerings as a cost-effective way to meet the diverse needs of employees, and 32% believe these offerings enhance the attractiveness of a company’s overall benefits package. Overall, 53% of the employers surveyed make voluntary benefits available to their employees. The largest employers lead the pack, with 68% of companies with 5,000 to 24,999 employees offering voluntary benefits, compared with 40% of companies with 2 to 49 employees and 43% of those with 2 to 99 employees.
Effective education is key
While employees’ appetite for workplace products continues to grow, their confidence in making the right decisions for themselves or their families is on the decline.
“Having enough money to pay bills during a period of sudden income loss” topped the list of employees’ financial concerns. Among boomers, 52% are concerned that they are behind schedule in their retirement savings. Singles and young families in particular are living paycheck to paycheck, and only about one-third of each segment understands which benefits options best meet their needs.
