To add more value to employer benefits, employees expect more paid voluntary benefits at a time when more employers are placing the financial burden on employees because of the down economy, finds The Rise in the Employee-Driven Benefits Model, a recent report released by Prudential Financial Inc, Newark, N.J.
Forty-three percent of surveyed plan sponsors say they are more closely researching voluntary alternatives while 20 percent of employees have added a new voluntary benefit through their employer in the past year, the report notes.
"This notion of employees making more financial decisions at work didn't start with the recession or the recently passed health care legislation," says Andy Mako, senior vice president, product, marketing and strategic initiatives for Prudential's Group Insurance Business. "Interest has been gradually increasing over the past decade."
Recommended For You
As employers are protecting their health and financial standing, voluntary benefits are being seen as an alternative to providing no coverage, Mako says.
With new health care legislation and the instability across real estate and financial markets, more benefits changes are taking place, particularly to contain cost.
"Now we're seeing ideas about benefit cutbacks, financial literacy education and consumer-directed health plans being woven together to tell the larger industry story about why the employee-driven model is starting to make sense to more companies," Mako says.
Forty percent of plan sponsors say there will be a high impact on how benefits are funded, 41 percent say employer contributions will be significantly affected, and 36 percent say the number of employee benefits offered will be influenced. By 2015, approximately half of those surveyed also expects these findings will be even more crucial.
"Voluntary benefits are becoming an integral part of the benefits equation for many plan sponsors and their employees," Mako says.
The report finds two-thirds of workers believe voluntary products add to the value of employer benefits packages, compared to 59 percent in 2009.
"Employee curiosity about voluntary products highlights an opportunity for companies to improve their benefits communications and focus on educating their workforce on the value and benefits of critical illness insurance, optional life insurance, disability insurance or long-term care insurance," Mako adds.
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
