Big Increases in Voluntary Benefits Participation
According to a survey by professional services efirm Aon, the number of employers offering voluntary benefits increased by 41 percent from 2021 to 2022.
The firm stated that the significant growth results from employers attempting to combat the Great Resignation and employees demanding access to more health insurance products due to the COVID-19 pandemic.
According to the survey, 16 percent more workers have become eligible for these perks from 2021 to 2022, while employee participation increased significantly in more than 50% of the ten most popular benefits. For example, employee participation in critical insurance programs rose from 16% in 2021 to 27% in 2022, while accident insurance participation went from 13% to 23%. Other voluntary benefits that saw increases include hospital indemnity insurance, (10% to 16%), permanent life insurance (10% to 15%), and student loan assistance (8% to 12%).
Aon spokesperson Danny McCauley explained how the increased utilization of voluntary benefits reflects the way the pandemic has made employees more aware of the risks of hospitalization and becoming critically ill.
Voluntary benefits are services or goods offered by an employer at a preferred rate and/or with little or no underwriting involved. For employees to participate, they must cover at least part of the cost. These benefits can range from various forms of health insurance and financial assistance to wellness and lifestyle services. According to a consumer survey by Voya Financial, 70% of employees eligible for voluntary benefits stated that they would be more likely to work for a company offering these perks. However, when it came time to enroll, only 49% of benefit-eligible workers signed up for the plans provided by the companies they work for.
According to Rob Grubka with Voya Financial, the pandemic may have raised awareness of the importance of health and wellness, but there is still some confusion surrounding voluntary benefits. He explained that it can take time for workers to understand these benefits or even get the help required to sign up for programs they’ve never participated in.
The survey found that lack of awareness is the most prevalent among millennials. For example, of the 78% of employed millennials who stated they were more likely to work for a company offering voluntary benefits, only 49% signed up for any of these programs.
According to Grubka, the most likely reason for the lack of participation is that millennials don’t have the time or inclination to learn about these benefits because they are focused on building families and advancing their careers. According to Voya, 31% of benefit-eligible employees stated that they didn’t completely understand the benefits they chose during the open enrollment period. Rising inflation is also a factor, considering that 74% of Americans stated that the value of their earnings has declined.
Andrew Frend of Voya Health Solutions stated that American employees are looking for ways to get the most for their money. As a result, they seek help from the people they trust, namely their employers. A previous survey showed that 73% of benefit-eligible employees want help understanding how to better manage their future retirement, emergency savings, and healthcare expenses. Frend believes this is an excellent opportunity for employers to support their workers in improving their health and financial well-being.