Although many companies continue to tighten their financial belts, when it comes to voluntary benefits, employers are much more employee focused, as opposed to cost driven. The Gauging the Success of Voluntary Benefits, the second in a series of research briefs stemming from Prudential’s Sixth Annual Study of Employee Benefits: Today & Beyond, found that 75% of employers say their top reason for offering voluntary benefits is to expand the benefits options available to their employees, with 42% offering voluntary benefits to fulfill an employee need, and 30% offering them at their employees’ request.
Voluntary benefits are optional programs that are made available at the workplace and 100% paid for by employees. 85% of employers say they offer one or more voluntary benefits including life insurance (63%), disability insurance (56%), and dental insurance (52%). Ranking lower on their priority list were critical illness insurance (35%) and long-term care insurance (33%).
“Voluntary benefits have great value for both employers and employees. Unlike traditional health insurance paid for entirely or in part by employers, voluntary benefits typically are a cost-effective option for employers to provide,” said Jim Gemus, senior vice president of Prudential Group Insurance. “For employees, the benefits offer a convenient and affordable way to purchase life, disability, long-term care, dental and vision insurance, while offsetting the income-related risks of a disability, long-term illness or the death of the family member.”
Employees increasingly view the workplace as an important source for personal insurance and savings products. Half (51%) of workers cited convenience as the most common advantage and driving factor in purchasing voluntary benefits because they pay for them through payroll deduction, representing a nine-point increase since the study was conducted in 2008. 52% feel that offering voluntary benefits increases the value of their company’s offerings.
The study found a correlation between voluntary benefits offerings and employee satisfaction. For employers, employee satisfaction is the top gauge of success (47%) followed by achieving a certain set participation rate (34%). Gemus noted, “Employees’ increasing interest and knowledge of their benefits options, combined with employers’ renewed focus on employee satisfaction is a win-win situation for all.”
Reflecting its commitment to education, Prudential has launched a new online educational resource open to all, with tips and tools to help consumers understand voluntary benefits and make informed benefits decisions. Visit www.prudential.com/benefitsmatter to learn more.
Gauging the Success of Voluntary Benefits is the second in a series of five research briefs that highlight the major findings from Prudential’s Sixth Annual Study of Employee Benefits: Today & Beyond. The research was conducted via the Internet during April and May of 2011, 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, long-term care, dental, and corporate and trust-owned life insurance in the U.S. to institutional clients primarily for use in connection with employee and membership benefits plans. The business also sells individual long-term care insurance, and accidental death and dismemberment, and other ancillary coverages and provides plan administrative services in connection with its insurance coverages.
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