Why You Should Offer a Voluntary Benefits Plan

In this super-tight labor market, organizations are hunting for every edge they can find to recruit and retain talent. On the benefits front, they’re increasingly focusing on voluntary benefits as a vehicle. More and more, employers are bundling such benefits with existing comprehensive packages to lure and keep employees, but also to provide value and mitigate financial risk. Keep reading for more about why you should offer a voluntary benefits plan.

The Issue

With so much societal, economical, and business upheaval about, voluntary benefits have never been more important. Employees are increasingly looking for more, and voluntary benefits provide choice and flexibility as well as value, as employers pass savings on to their people. In fact, nearly 90 percent of organizations have already made voluntary benefits a prominent part of their overall strategy.

What are Voluntary Benefits?

Essentially, these benefits, which are also called voluntary group insurance, are plans provided to employees at little to no cost to the organization. They are offered at a group rate to employees, who pay for the services through payroll deduction.

Note that such benefits are not an employee requirement; rather, employees “opt in” to them.

What are Examples of Voluntary Benefits?

Such benefits can include, but aren’t limited to, hospital indemnity insurance, accident insurance, disability insurance, life insurance, dental insurance, financial education and counseling, pet insurance, student loan repayment programs, ID theft protection, elder care, critical illness coverage, career development, legal insurance, telemedicine, and long-term care insurance.

What are the Benefits of Voluntary Benefits Plans?

We’ve already gone over several of them, but consider that:

• They provide choice. People like to be able to pick and choose, especially if all the options are meaningful. What’s more, choice results in improved benefits satisfaction, which, in turn, leads to increased overall employee engagement, which ultimately affects your bottom line. According to Mercer, 60 percent of employees want more customization and choice.
• They address workplace diversity. Nearly all workplaces have people who differ generationally, culturally, economically, or otherwise. Diversity does matter when it comes to benefits. And, thus, so do choices.
• They improve employees’ finances. A well-crafted voluntary benefits plan can enhance employees’ financial wellbeing, which makes them happier and more productive. As it now stands, 60 percent of employees live paycheck to paycheck, and almost half of them can’t handle an unexpected expense that exceeds $1,000.
• They attract new employees. As we say, it’s an employees’ market right now; people are pickier about where they want to work. Employers can use their voluntary benefits program – and accompanying options and savings – to recruit new talent.
• They support employee retention. Likewise, as the labor market continues to tighten, voluntary benefits can keep your key people from leaving you for the competition. If you already offer such a program, perhaps you should consider changing or enhancing it. You want numbers? Some 73 percent of employees say that benefits that are tailored to their needs heightens loyalty to their organization.
• They simplify administration. Bundling voluntary benefits with existing insurance carriers not only provides cost savings and rate guarantees, but they streamline administration, freeing you to focus more on your core business.

So, now you know why you should offer a voluntary benefits plan. But not all such programs are the same. Perhaps you should consider Mercer, which has been turning out such plans for more than 85 years. Mercer has the expertise to craft and delivers a winning program that is in keeping with your benefits strategy and that provides your employees with value.