Windsor, CT, July 16, 2003 � Twenty-five percent of the nation’s employers � an estimated 300,000 companies, large and small � are interested in introducing, or expanding their offerings of, voluntary benefits, insurance programs that employees pay for but are able to get at lower cost through their workplace.
“Despite the flat economy and higher unemployment levels, employers are still concerned about maintaining competitive benefit packages,” said Patrick Leary, manager of distribution research for LIMRA International. “A big part of their benefits strategy includes voluntary programs.”
Employers are also going beyond the traditional life, accident, and disability programs to offer long-term care insurance, critical illness insurance, and Section 529 college savings plans. About one-third of the largest employers (5,000+) offer a voluntary LTCI benefit and many large employers plan to further expand their offerings.
“Large employers clearly see the value in a voluntary benefits package,” Leary said. “Despite the fact that these large firms already have multiple voluntary benefits in place, more than half are considering adding more.” For worksite marketers, larger firms (1,000+) represent over 27 million potential employee customers that would have access to new voluntary benefits.
Firms in the service and manufacturing industries have the most interest in offering new voluntary benefits. “These industries represent the classic worksite markets,” Leary said. “The middle income market, which many view as underserved, is very receptive to worksite programs.”
Among small employers (10-100 employees), well over half offer at least one voluntary benefit, with many offering three or more. Cancer insurance, accident insurance, dental coverage and supplemental medical plans have seen strong growth in the small employer market. Firms may look to benefits such as these to help offset some of the adjustments they have needed to make in their increasingly costly medical plans.
“With rising benefits cost, small firms especially are no longer able to absorb these increases and are either passing these costs on to their employees in the form of higher premiums, deductibles, and copays, or they are cutting back on benefits,” Leary said.
Visit the LIMRA Web site at www.limra.com for more information.