Theres been a surge in voluntary benefits the past decade. During that time, employees have increased purchases by $18 billion voluntary spending jumped 24% last year alone according to Unums recently released benefits buyers study.
Bill Dalicandro, vice president of Unums consumer solutions group, attributes the recent growth to increased demand, a stronger economy and the Affordable Care Act, which created a market for voluntary benefits.
The movement toward consumer-driven health plans and continued rising cost of health care are also responsible for increased spending on voluntary benefits, says David Underhill, Cignas vice president of voluntary products. Accidental injury, critical illness and hospital indemnity plans are three of the most popular products today, he says, as employers seek to save money with high-deductible plans while simultaneously helping employees bridge gaps in coverage.
CDHPs have sparked increased interest in other non-traditional products like pet insurance and identity theft protection, Underhill says. Its really, really shifting the way weve developed products in the past, he says.
Spending increases with age
Unums study found that older employees increased voluntary spending the most from 2010 to 2013, workers ages 60 and older spent more than any age group while employees ages 20 to 29 and 50 to 59 spent more than those 30 to 49. The growth spans companies of all sizes and industries, Dalicandro says. We really have seen a healthy mix from various market segments and client sizes, he says. Its client-based, but theres a macro trend that speaks to supplemental health products.
Cost-sharing was another buying trend reported in Unums study. Looking at group life coverage from 2003 to 2013, Unum found the number of employers that provided full coverage fell from 70% to 50%. During the same span, the percentage of employers sharing that cost doubled to more than 20%. Employees paying for all of their group life coverage increased to just under 30% roughly a 10% gain.
According to a 2013 LIMRA survey, the top five voluntary benefits were dental, short-term disability, long-term disability, accident and term life. Financial protection is important, Dalicandro says, and voluntary benefits are a way employers can provide that security to a wide range of employees. Its as diverse a workforce as its ever been, he says.
Register or login for access to this item and much more
All Employee Benefit Adviser content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access