Voluntary Benefits, Happier Workers

“Employees aren’t just assets, they’re investments.” It’s a cliché, but it’s one of those clichés that carries the power of truth. Given how much you’ll spend on your employees over the course of their careers, you can’t help but think of them as such.

Problem is, that kind of investment is getting harder to afford. Money for new salaries remains scarce in a struggling economy; funds for employee benefits can be scarcer still. Yet if you don’t make those kinds of investments in human capital, your employees may begin to feel unappreciated — and may start looking for outside opportunities.

There is, however, a simple solution to this quandry. Making voluntary insurance options available to your workforce doesn’t add benefit costs to your bottom line, yet it can go a long way toward making your employees more satisfied — and more financially secure, even in tough times.

Ensuring Happy Employees

“Employee morale” is one of those concepts that is s easy to talk about but difficult to measure. The 2013 Aflac WorkForces Report, though, found that the strength of a company’s benefits package has a major effect on how employees feel about their jobs. According to the report, workers overwhelmingly agree that benefits influence:

  • Work productivity (70 percent)
  • Employee loyalty (81 percent)
  • Overall job satisfaction (84 percent)

As a result, better benefits can play a meaningful role in improving work environments where malaise has set in. According to the most recent study from the Life Insurance and Market Research Association, 38 percent of workers who feel their employers don’t care about their workers said they’re likely to leave in the next year, but of those employees, nearly 4 in 10 said a comprehensive benefits offering would demonstrate their employers value them.

Why do voluntary benefits options make such a big difference? Because the right combination of benefits can make a huge difference in an employee’s financial security. Even the best major medical plans can leave employees with out-of-pocket medical expenses—not to mention daily living costs such as household bills, gas and groceries. The combined expenses can start stretching family budgets to the breaking point when an income earner has to miss work due to an accident or illness.  There are a variety of voluntary supplemental insurance policies such as accident, critical illness or hospital indemnity plans that are designed to help with all out-of-pocket expenses.

A Difference in the Bottom Line

The help with out-of-pocket expenses is a big upside for employees — and a pretty big return on investment for employers, considering that voluntary benefits come at no additional benefits cost to businesses.

Aflac’s research found a striking correlation between offering voluntary benefits and reducing workers’ compensation claims: 25 percent of businesses offering voluntary benefits saw lower claims since it began offering voluntary benefits. What’s more, some major-medical providers may be inclined to lower their rates if they know a company’s workers have the additional protection of a hospital policy, to name just one example.

Offering voluntary insurance policies to employees can also lower a company’s corporate taxes by reducing their FICA contributions. Supplemental benefits, then, can pay off in a number of unexpected ways — all of which are valuable as businesses scramble to manage costs with health care reform provisions looming on the horizon.

Creating Breathing Room

The Patient Protection and Affordable Care Act, passed by Congress in 2010 and upheld by the Supreme Court last summer, may yet prove to be a boon for millions of Americans who wouldn’t have access to medical coverage otherwise. However, the Act is leaving some employers, particularly small businesses, with difficult choices as to how they will  provide their employees the newly mandated coverage.

To control rising costs, some businesses may dial back their levels of coverage. Others may move to higher-deductible plans that place greater financial burdens on employees. Of businesses with fewer than 50 employees, 36.6 percent are considering dropping health coverage altogether and sending their employees to state-sponsored insurance exchanges, according to consulting firm McKinsey & Company.

In both cases, voluntary insurance can help employees who’ve been saddled with increased financial responsibility for their own care. Some supplemental policies can bridge the gaps in employee budgets created by higher deductibles and co-pays. If employees turn to state exchanges but either can’t find or can’t afford certain benefits, a comprehensive benefits package that includes supplemental insurance can go a long way toward providing a safety net.

The flexibility of voluntary benefits may be their greatest draw. The variety of supplemental benefits is immense — everything from accident and illness coverage to dental and vision policies, many of which include wellness benefits that offer employees incentives to stay fit and healthy.

With the help of a qualified insurance agent who can provide good advice, an employer can custom build a voluntary benefits package tailored to its workforce’s specific situations and needs. An agent can even devise a plan for combining voluntary benefits with certain major medical solutions to ensure all the bases are covered — at a much lower cost than the employer might’ve anticipated.

The benefits you offer employees are investments in happiness, loyalty and each employee being the best worker they can be. Once upon a time, those benefits were more or less synonymous with “major medical coverage,” while voluntary benefits were an optional extra at best.

Increasingly, though, companies of all sizes are finding that making voluntary coverage an integral part of its benefits offerings results in lower overall costs as well as happier employees.  Ultimately, happier employees are free to spend less time worrying about making ends meet and more time giving 100 percent effort on the job each day.

John T. Harmeling is Aflac’s senior vice president of worksite marketing. Harmeling is responsible for developing and driving growth strategies in Aflac’s worksite segment, overseeing integrated sales and marketing programs across all sales channels, and extending the company’s efforts to attract and retain customers. For more information about Aflac, call 1-800-99-AFLAC (1-800-992-3522) or email [email protected].

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