Employers and Employees Agree on the Value of Voluntary Benefits
Brokers and Employers Expect Increased Demand for Voluntary, Employee-Paid Coverage
NEWARK, N.J.--(BUSINESS WIRE)-- In an effort to manage health care costs, employers are introducing more voluntary benefits and employees are responding in large numbers. According to The State of Group Voluntary Benefits, the second in a series of research briefs stemming from The Prudential Insurance Company of America's (Prudential's) Seventh Annual Study of Employee Benefits:Today & Beyond, 63% of employees who say their employer offers at least one voluntary benefit agree that such benefits increase the value of their company's benefits program. And, employees who said they are interested in receiving more voluntary benefits through the workplace increased 10 percentage points; 34% from 24% a year ago.
"Employers and employees agree on the value of voluntary benefits," says Bob Patience, vice president, voluntary benefits, Prudential Group Insurance. "Employers see an increase in employees' satisfaction with their benefits program, while employees appreciate their employers' endorsement of the products offered, and believe they get good value because of their employers' involvement and diligence."
Indicating a possible future trend, 44% of brokers currently selling voluntary products are expecting increased demand for these benefits over the next five years, representing an increase of 10% over last year. Brokers foresee the biggest increase in the adoption of critical illness insurance, with 41% believing it will increase. Critical illness coverage pays a lump sum for covered illnesses or conditions such as cancer, heart attack and stroke surgery. Interestingly, signaling that better communication and more education may be needed regarding worksite benefits, 27% of employees surveyed said they weren't sure if critical illness is part of their current employee benefit package.
Other voluntary products expected to be purchased in larger numbers are accident insurance, (31%) long and short-term disability insurance, (30%, 28% respectively) dental insurance, (27%) and life insurance (25 %.)
"Purchasing benefits at the workplace can provide employees with multiple advantages, including the education and tools to make informed, needs based choices," continues Patience. "Not only can they purchase coverage through the convenience of employer-based enrollment systems, but also pay for the coverage using payroll deductions. Taking full advantage of attractive employer based voluntary benefit programs is a great way for employees to improve their "financial wellness."
One in three employees agree that losing their voluntary benefits would be disruptive and expensive. However, employee opinions on the advantage of being offered voluntary benefits vary somewhat based on age, gender, and education. Those over the age of 60 (62%) see the advantage of guaranteed coverage. Post-graduates are more likely to agree (56%) that voluntary benefits provide access to a wider range of useful coverages. 53% of women versus 45% of men say that voluntary benefits are more convenient because of payroll deductions. In addition, for brokers, employers, and employees, the benefits carrier name has grown in importance.
The State of Group Voluntary Benefits is the second in a series of five research briefs that highlight the major findings from Prudential's Seventh Annual Study of Employee Benefits: Today & Beyond.The research was conducted via the Internet during July 2012, and consisted of three distinct surveys of plan sponsors, plan participants, and broker/consultant audiences.
Prudential Group Insurance manufactures and distributes a full range of group life, long-term and short-term disability and corporate and trust-owned life insurance in the U.S to institutional clients primarily for us in connection with employee and membership benefits plans. The business also sells critical illness insurance, accidental death and dismemberment and other ancillary coverages and provides plan administrative services in connection with its insurance coverages.
Prudential Financial, Inc. (NYS: PRU) , a financial services leader, has operations in the United States, Asia, Europe, and Latin America. Prudential's diverse and talented employees are committed to helping individual and institutional customers grow and protect their wealth through a variety of products and services, including life insurance, annuities, retirement-related services, mutual funds and investment management. In the U.S., Prudential's iconic Rock symbol has stood for strength, stability, expertise and innovation for more than a century. For more information, please visit http://www.news.prudential.com/.
Prudential, the Prudential logo and the Rock symbol are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide.
Group coverages issued by The Prudential Insurance Company of America, 751 Broad Street, Newark, NJ 07102.
Prudential Financial, Inc.
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