Voluntary benefits have grown consistently over the past 10 to 12 years (since we've been tracking them), and 2009 was no exception. Despite the economy, sales grew as compared to 2008, and there is plenty of evidence that they can continue to grow. Better yet, we've only just begun in voluntary benefits so the opportunity is very real.
Consider this. Depending on the size of the employer, between 13 percent and 35 percent still do not offer even one voluntary benefit. The smaller employer (with between 10 and 100 employees) is the most likely to not offer any voluntary. The Census Bureau estimates there are about 1.2 million businesses in the United States with between 10 and 100 employees. That's more than 400,000 new cases just in this one size segment.
Just as importantly, many employers who already offer a voluntary benefit are "hooked." They find that voluntary serves as a way to meet the needs of employees without out-of-pocket costs to the employer. On average, employers offer three voluntary products. However, some offer more and claim to be open to new ideas.
In a recent survey of benefit managers, 20 percent said they were likely to add at least one new voluntary benefit in the next two years. That's one out of five who are considering this -- despite the economy and without any sales presentation or specific product mentioned.
Benefit managers are also open to a wide array of voluntary products. As we have written in previous columns, they no longer look only to products that the majority of employees want/need. The mind-set is that, if some employees are interested, why not offer it?
The interest index is a measure of the percentage not offering the product type and the percentage that expressed a likelihood to consider offering the product on an employee-pay-all basis.
So the future is still bright for voluntary products and the producers who sell them. Are you seizing this big opportunity? Are you selling your share? It's definitely time to give it serious consideration -- and take action!
Gil Lowerre can be reached at (860) 676-9633 or glowerre@eastbridge.com.
Bonnie Brazzell can be reached at (803) 738-1236 or bbrazzell@eastbridge.com.
