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In the world of workplace nonmedical benefits, product designcan seem like a bit of an arms race. Seeking to differentiate theirproducts in the market, carriers continue to add new benefittriggers, features and riders. Employers selecting a new plan orcarrier must sort through an increasing number of options, hopingto choose a product that will provide the most value to theirworkers at a reasonable price.  At the same time, thisgrowing complexity can make it more difficult for employees tounderstand their benefits, negatively impacting the customer experience.

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Which benefit features are actually important to employees — theusers of these products? To explore this question, LIMRA recentlysurveyed employees about their views oo product features for threecommon workplace benefits: accident insurance, critical illness andlife insurance.

What matters most?

It is worth noting that employees have generally positive viewsof most potential product features, with at least 50 percent ofemployees rating almost every feature as "important" to them.However, some benefit attributes are clearly valued more thanothers.

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Some of the most important attributes to employees vary byproduct. For example, 24-hour coverage is among the most-desiredfeatures for accident insurance, whereas this distinction isgenerally not relevant to most other benefits. In contrast, theability to obtain coverage without medical underwriting isconsidered very important for critical illness insurance.

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In addition to these product-specific preferences, severalcommon themes emerge regarding which types of features tend to bemost important to employees across all three products.

Coverage they can keep

Employees place a lot of value on benefit attributes that ensurethey will be able to keep their coverage in the future. Forexample, a provision that the benefit amount will not reduce whenemployees reach a certain age is the most desired feature for allthree products. Other features that help employees keep theircoverage are also highly ranked, such as the ability to continuecoverage during a temporary strike or leave of absence, generalportability and disability waiver of premium.

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It is possible that employees' memories of widespread job lossesduring the Great Recession are contributing to this emphasis onbenefit continuation. It may also be a result of the general humantendency to believe that serious illness and death will only happento people when they are very old, making employees want to keeptheir benefits until they are needed later in life.

Families matter

Employees also place a lot of value on the ability to obtaincoverage for their spouses, partners and dependent children throughworkplace plans. As expected, married employees and those withchildren under age 18 are the most likely to care about thesefeatures.

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While coverage for children is important, employees expresslittle interest in obtaining coverage for theirgrandchildren through the workplace.

Keeping it level

When it comes to rate structure, most employees prefer "issueage" pricing, where the initial cost may be higher but premiumsremain flat, rather than "attained age" pricing with lower initialpremiums that increase with age.

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It is understandable that employees want predictable costs theyknow they will be able to afford in the future. It is important tonote, however, that this type of pricing can create challenges whencases move between carriers. On takeover business, customers oftenexpect the new carrier to maintain pricing based on the originalissue age, but it can be difficult for carriers' pricing models toaccommodate this. Employers should be made aware of thesechallenges when selecting a plan, since friction over this issuecan result in lower customersatisfaction. 

"Value adds" are not adding value

Which benefit features matter the least to employees?Ironically, they tend to be the "value added" services thatcarriers often attach to their products to provide additionalresources to employees. In particular, offerings such as travelassistance, financial planning and will preparation services tendto be ranked as least important to employees.

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Younger workers are somewhat more likely to value theseservices, perhaps because they are less financially knowledgeableand therefore want more assistance with these matters.

Setting the right priorities

By helping employers understand which benefit attributes will bevalued the most by their employees, brokers can guide their clientsto selecting the most appropriate benefit packages for theirworkforces. Employers may also want to focus more effort oneducating employees about these key product features during openenrollment, which may pique employees' interest and potentiallyresult in higher participation rates.

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By prioritizing the benefit features that truly appeal to theusers of these coverages, brokers and employers can provide bettervalue to employees and improve the customer experience for everyoneinvolved.

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Kimberly Landry is assistant research director, WorkplaceBenefits Research, LIMRA.

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