Voluntary benefits have captured trade publications headlines recently, but do you know what they are? Voluntary benefits are benefits that are generally fully paid by employees and are cost effective because they are offered on a group basis. They are flexible—employers can provide the administration to take payroll deductions, or the benefits can be directly paid via credit cards or bank accounts. Typically, employers only provide core benefits, which include medical, dental, life insurance and disability benefits.

Employees have come to expect “core” benefits. They assume that there will be a plan to help pay for their medical expenses – they trust that if they become injured or sick, that there will be a disability plan to provide them with income. Employer-provided health care comes at a cost.  With the introduction of the Affordable Care Act several years ago, mandatory coverages have increased costs exponentially for both employers and employees. To help employees manage costs associated with high deductible health plans, employers have added voluntary benefits.  Critical illness insurance, hospital indemnity insurance, and accident insurance provide a low-cost safety net that can help pay for some of these out-of-pocket expenses.

Sophisticated employers can create a broad benefit program that appeals to a diverse workforce. By offering a variety of different benefits, employees can pick and choose those that enhance their current coverage at costs that won’t break the bank. Examples of voluntary benefits include:

• Group auto and homeowner’s insurance: Offers employee discounts based on tenure, multi-policies and paying via payroll deduction. Since participation is not confined to an annual enrollment period.  Employees can shop their best deals throughout the year.
• Voluntary identity theft protection programs Entices a workforce that is dependent on online banking and e-commerce. This type of program monitors the participant’s identity in all disciplines: financial, social media and often medical. Should a breach occur, advocates assume the time-consuming activity of restoring the member’s identity. In this fast-paced world fraught with digital dangers, peace of mind at less than a dollar a day is money well spent.
• Pet insurance: Helps employees save on the high cost of veterinary bills. By offering pet insurance, employees can elect to cover their furry companions for pennies on the dollar and know that a trip to the vet won’t break the bank.
• Group vision: Some organizations offer this as a core benefit, but if they don’t, a voluntary group vision plan covers annual eye exams and eyewear.
• Group legal insurance: Covers will require preparation, traffic tickets, real estate transactions, document review, etc. With access to an accredited network of attorneys, it is like having a lawyer on retainer for a fraction of the cost.
• Long-term care insurance: While true group long-term care plans exited the market several years ago, there are still carriers that offer multi-life policies with the simplified issue.
• Student loan repayment benefits: Offers access to financial professionals who can help navigate whether or not refinancing is a viable option or providing advice about how to decrease the debt can contribute to employee satisfaction and retention.
• Employee purchasing plans: Allows individuals to purchase products that they need and want with monthly payments through payroll deduction. Employees who are short on cash and have low credit scores benefit from an employee purchasing program. It helps to establish credit while providing access to necessary products such as computers, large appliances, etc. These programs are a better way for employees to extend their money rather than withdrawing from 401(k) plans or other savings vehicles.
  
  

If you’re interested in expanding your benefit offerings to include voluntary programs, it’s important to fully understand how they will complement your existing offerings. Partner with a trusted consultant who can help you think through the strategy, development, and analysis of the RFP process and help to communicate and implement the program. Voluntary benefits outsourcing companies are your best partners because they work to align the needs of your organization to the best partners in the market.

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