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Voluntary Benefits are simple.
They allow employers to expand their benefit package at no cost to the organization.
Because the premiums are typically paid for 100% by the employees with the premium payroll-deducted by the employer.
The impact of COVID-19 on employees’ lives and their finances really shined a spotlight on the value of voluntary benefits, which have given employers a way to meet the shifting needs and priorities of their workforce during this critical time.
In 2022, employers will continue to seek ways to expand the voluntary benefit offerings in their employee benefit packages to provide more customized options to meet workforce needs, whether that’s targeting traditional voluntary benefits or non-traditional ones for lifestyle, personal wellness and financial health.
Elite-VB works directly with organizations to either introduce voluntary for the first time or evaluate your current program in force to ensure that it is reaching your company’s benefit objectives and fills the appropriate needs for your employee demographics. You can use my VB Checklist to see where you program will compare to the various programs and services we may be able to offer your firm.
Never has been the need been greater as employees are choosing voluntary benefit options as a ‘go-to’ to help them face financial challenges as a result of COVID-19, a heart attack, stroke, cancer diagnosis or premature death. Peace of mind is what employees want…you need benefits that help to attract and retain employees with zero impact to your bottom line.
COVID CHANGED EVERYTHING
The new realities of the ongoing pandemic and its effect on the workplace continue to be more evident. Forecasting where the future will take us is unsure but getting the right knowledge about where the market is now is crucial for HR and business owners (learn more with my one hour CE on “Covid on Voluntary”).
As of December of 2021, most Americans have received a vaccine, but we can see now with almost two years of Covid, how variants and vaccine hesitancy will be a constant threat. Employees have endured a lot of stress and look to the workplace to help them with benefits that address their concerns: mentally, emotionally and physically.
In the meantime, employers are struggling to keep their businesses open as employees look for workplaces that provide flexibility, work-life balance and mental health concerns. Hybrid work places have become the norm.
Purchasing Power recently conducted an informal survey of 93 HR professionals to assess the impact that both COVID-19 and financial stress is having in their workforces.
• 56% of employers reported more 401K withdrawals;
• 36% had requests for financial assistance from the company; and
• 6% saw requests for payday advances.
- 81% said employees had a spouse or partner laid off or furloughed during the pandemic, so money is tighter than ever;
• 49% said employees had family or household members who contracted COVID-19 and there are unexpected medical expenses involved;
• 48% said employees had college-age children return home from school and are back living at home; and
• 34% said employees had extended family members out of work right now who needed financial support.
Voluntary benefits can address many of the specific needs that employees have as they continue to struggle with and overcome pandemic challenges. In fact, the survey revealed that 22% of HR professionals plan to add new financial wellness benefits to their employee benefits package.
Because employees are in such a fragile state, when they need to lower stress and FINANCIALLY survive an injury or illness options are either to put the expense on a charge card, take money out of retirement, get a payday loan or sometimes go bankrupt.
Disability, accident, critical care and hospital plans can provide a safety net for pennies a day. When we meet, we will discuss which benefits/carriers/platforms and payroll deduction method might be ideal for your organization such as:
EMPLOYEE PAID – PAYROLL DEDUCTED
True Group – census rated such as Guardian, SunLife, Voya and more in which we need a simple census (dates of birth, gender, occupation and salary) sent to the carriers to they complete their bid with custom premiums for your company along with any limitations or restrictions to the offering. Advantage: likely lower rates (especially when compared to shelf-rated carriers such as Aflac and Colonial) and plan designs that can be extremely customized to the client’s needs including HIGH “guaranteed issue” offerings (means ALL policies will issue regardless of health up to certain limits)
Group / NON-CENSUS rated (such as Assurity) – we call these rates “SHELF RATED” as the plan designs and rates are filed with the state and no census is needed. Rates are the same for each organization, plans are portable and guarantee issue options are abundant for each and every open enrollment along with zero increase in premium.
EMPLOYER PAID + BUY-UP FROM EMPLOYEES
- Long-Term Disability
- Group Term Life
EMPLOYEE PAID – NON-PAYROLL DEDUCTED
This option is becoming more and more popular and there are carriers that operate in this market with enrollment platforms such as Paylogix that will take the premiums from the employee’s checking account, debit or credit card. I LOVE LifeRaft - a cutting edge supplemental carrier that can provide "guarantee issue" products on a non-payroll deducted basis (LOVE THIS IDEA for ASSOCIATIONS)
“BUNDLED” product offering (one carrier) or a combinatioN
Every company is different and there are times when offering products from ONE carrier is preferable, and sometimes a mixture of carriers may be needed
Long-term disability with a 90-day wait works great with a voluntary, employee-paid short-term disability plan. Sometime employers wish to pay for a benefit, such as Group Accident and this is easy to accomplish with extremely low rates.
Remember the old days when Cafeteria Plans were popular? They are back as employers can set aside pre-tax dollars for employees to go “shopping down voluntary benefit lane” and pick and choose the benefits THEY wish to participate in.
TRADITIONAL EMPLOYEE-PAID BENEFITS
You want what’s best for you and your employees’ health and well-being. Yet rising health care costs can make it difficult for employees to take care of themselves and their families – and your budget can only go so far. Employees are in a fragile state and voluntary benefits provides personalized protection. Elite-VB will tailor affordable employee-paid benefits to the needs of your workforce while also complimenting your employer-paid benefits portfolio. Let’s explore:
- One in Eight workers will be disabled for 5 years or more!
- 46% of home foreclosures are brought about by a disability.
- Even young people get disabled with 30% of Americans between age 35-65 will experience a disability lasting more than 90 days.
- In Hawaii, we can only cover 30% of salary due to Temporary Disability with 66% coverage in Alaska
- Heart Disease is the #1 cause of death in Hawai’i and Alaska.
- 85% of heart attack victims survive.
- Stroke is the leading cause of disability and
- Cancer is the #2 cause of death in Hawai’i and 67% of the costs related to cancer is typically NOT covered by medical insurance.
- 58% of all employees have insufficient life insurance.
- More than 30% of Americans said they think life insurance “is more important to own now due to the pandemic, and plan to purchase more as a result of Covid-19 and
- Voluntary life insurance rarely replaces current life insurance in force, rather it “compliments” existing coverage, providing an additional layer of protection…regardless of health
- Fatal injuries are a major public health problem in Hawai’i, constituting the 4th leading cause of death among state residents. Injuries are by far the leading cause of mortality among residents aged 1 to 40 years.
- Although of a lesser severity, nonfatal injuries greatly outnumber fatal injuries, and constitute significant medical and financial burdens for the residents of Hawai’i. For every resident who dies from an injury there are nearly 10 others who are hospitalized for nonfatal injuries, and another 118 who are treated and released from emergency departments (EDs).
- These ratios translate to 5,980 hospitalizations from nonfatal injuries and nearly 80,000 visits to EDs each year in Hawai’i.
- It’s easy to underestimate how much medical care can cost: Fixing a broken leg can cost up to $7,500. The average cost of a 3-day hospital stay is around $30,000. While medical insurance pays the doctors and hospitals, accident plans are great as they tend to cover many of the procedures that are subject to a person’s deductible and procedures not covered by medical.
- This figure does not include major procedures, ambulance fees, or other charges. It’s easy to see how a short stay in the hospital may leave your family in a difficult financial situation.
- Even with hospitals required to list charges, it can be confusing to members of the public because hospital charges are not what people are asked to pay,” said a spokeswoman at Adventist Health Castle in Kailua.
As a result of the pandemic, we see tremendous interest in critical illness insurance and mental health benefits. A recent Mercer survey revealed that 22% of employers are enhancing voluntary benefits like critical illness insurance and 20% are adding or improving behavioral health care benefits.
Elite-VB would encourage ANY ORGANIZATION to offer (at minimum) ACCIDENT and CRITICAL ILLNESS and PERMANENT LIFE as voluntary benefits assuming that medical, disability and life is paid for by the company. These three plans will address “gaps” that medical doesn’t cover and with 100% guaranteed issue coverage, all employees with qualify and you now have DOUBLED your benefit offering with zero increase to your benefit budget!
We believe the non-traditional benefits are great but shouldn’t be offered in place of traditional “financial wellness”-type voluntary benefits with DISABILITY and LIFE taking top billing.
However, employees have a need for these benefits and offering them via payroll deduction to the employee means they can purchase these benefits at a lower cost than non-payroll deduction. They include:
With many employees on the internet, identity theft now affects one in two Americans. We utilize some great companies in the market that can provide outstanding value for the benefit such as AURA – who provide more than just ID Theft…they are all about “cyber wellness”
Many Americans do not have an up to date Will, Durable Power of Attorney and Living Will. These plans are great to allow your employees to take care of those they love and pair great with a new Life Insurance offering.
The pandemic meant more people working from home and pet ownership is at it’s highest ever. Pet insurance is a great way to minimize out-of-pocket costs and surprise bills for our furry friends.
These plans are great for employers who are looking to help their employees both lower their college debt as well as consolidate loans. They are great or attracting and retaining younger staff.
Purchasing Power is a purchase program sponsored by your organization that offers a better way for your employees to buy the brand-new products they want. Employees have fixed, easy payments without the stress that comes with high-interest credit cards. And unlike layaway, you get your order up front.
In closing, carriers have come to the market to outpace one another with amazing benefits, terrific premiums and high guaranteed issue limits. Elite-VB knows who they are and which ones are the best for your organization.