Why Some Managers are Big Fans of Voluntary Employee Benefits
Surveys often indicate that compensation isn’t the most important factor in recruiting and retaining employees — but competitive packages, including strong benefits offerings, still play a critical role. And one area of benefits that gained a lot of attention in recent years is voluntary benefits.
Unlike your “core” benefits like health and dental insurance, voluntary benefits generally are paid for by the employee, but at a reduced price due to the group rate obtained by the employer. “We’ve negotiated some nice rates for employees,” says Tom Peterson, vice president of human resources for Florida-based HomeRiver Group, a national manager that works with more than 125 associations
Voluntary benefits provide employees a wider variety of coverage levels and types of insurance than they could otherwise access. For example, an employee might sign up for hospitalization coverage to cover the out-of-pocket costs required under his health insurance. Employees can get the coverage without a medical examination or any individual underwriting, which is especially attractive to employees or candidates with preexisting conditions.
Essentially, Peterson says, voluntary benefits give employees the freedom of choice: “Every employee in every market has different demands and different needs, and they can buy what’s important to them.”
Early voluntary benefit offerings primarily were limited to supplemental medical plans, such as accidental, death, and dismemberment (AD&D), long-term care, and critical illness. Many employers have expanded their menu, though, adding benefits that support emotional and financial health in addition to physical well-being.
To learn more about the advantages voluntary benefits can provide both employers and employees, as well as some tips on how to get started with providing them, read our new article, Should You Offer Voluntary Benefits?