This is part of a special advertising section on the challenges facing HR executives in the coming year.
Thinking ahead to the coming year brings to mind the saying, "What's old is new again." That's especially true with regard to employee benefits. Human resource professionals today want the same things they always have -- to offer a competitive benefits package, control costs and minimize administration. Employers will continue to confront these challenges in 2010 and beyond.
Given the current economic climate, however, these goals carry heightened importance and an increased sense of urgency. While no one can predict exactly how long the recession will last, employers can certainly wield some control over their benefits challenges. And they can improve employee satisfaction in the process.
Many employers have learned that integrating voluntary benefits with core-group offerings can help alleviate their economic pressures and give employees the expanded choice they want. Nearly 650,000 firms with at least 10 employees now sponsor at least one employee-pay-all option, according to an August 2007 study by LIMRA International, and 56 percent of these employers say they are considering introducing a new voluntary benefit in the future.
Voluntary insurance plans allow employers to offer a more competitive benefits package at little or no direct cost to them. Employees choose the benefits that best meet their individual and family needs and typically pay for these products themselves. The plans are reasonably priced and complement the coverage currently offered by their employers. Typical products include disability coverage, life insurance, accident insurance, hospital confinement, and cancer and critical-illness plans.
When times are tough, you might question whether employees will spend money on additional benefits. Research shows they will. A recent study on buyer behavior trends in past recessions by McKinsey & Co. shows spending on personal insurance actually increased 43 percent. Though consumers must obviously prioritize their spending when dollars are tight, they still value their benefits.
Employers also value voluntary benefits and the many advantages they offer. In a separate LIMRA International study, companies reported seeing merit in the following areas:
* Improvement in worker morale/satisfaction -- 77 percent
* No added direct cost to the company -- 75 percent
* Ability to attract and retain employees -- 71 percent
* Giving employees options to purchase less expensive insurance than they could get on their own -- 69 percent
Take a Load Off HR
An additional advantage of voluntary benefits is streamlined administration. With reduced staff and increased workloads, HR departments today have less time to communicate changes to benefits packages and deal with multiple vendors. A good voluntary-benefits partner can handle the enrollment of both core and voluntary benefits efficiently and provide one-on-one counseling to make sure employees understand the value of their benefits.
And don't underestimate the value of good communication when it comes to employee benefits. Employees who believe their benefits are effectively communicated are more likely to feel their employers value their work and care about them. The majority say they would stay with their current employer even if they were offered the same pay and benefits somewhere else, according to a June 2009 report by Unum.
Though many of the challenges employers faced years ago are still just as relevant today, HR executives will find that voluntary benefits offer a tried-and-true solution to help them face what lies ahead.