When building a comprehensive benefits package, many business owners are (understandably) grateful just to be able to offer medical coverage. But some employers also tend to leave out voluntary benefits, which can enrich the employment experience and be a helpful recruitment tool for potential employees — all at little or no cost to the employer. If voluntary benefits are outside your purview, check out this quick-reference guide to fill in the blanks.
What Are Voluntary Benefits?
While the definition of voluntary benefits has become somewhat blurred over the years (and are sometimes referred to as worksite benefits or even ancillary benefits) they are, for the most part, insurance products meant to fill in healthcare gaps where health, dental, and vision insurance might not reach, and can increase the value of your employee benefits package. Typically, voluntary benefits are paid in full by the employee and made easy through payroll deductions — most of the time at a lower rate than what can be found on the individual market and frequently taken out of wages pre-tax.
Common examples of voluntary benefits include:
- Accident Insurance: Provides compensation to employees if they suffer major physical harm due to an accident. Some insurance policies even reimburse employees for seeing their doctor a couple times per year.
- Critical Illness: Provides a lump sum to enrollees in the event of a critical illness (such as a heart attack or stroke) which can be used to pay medical or non-medical expenses (like child-care) while an employee is unable to work.
- Cancer Insurance: In the event of a cancer diagnoses, an enrollee receives money with which to pay for treatment and sometimes, to help pay non-medical expenses.
- Pet Insurance: Coverage for pets to help alleviate the cost of a pet’s illness, oftentimes used during end-of-life care (although the policy must be purchased when the pet is still healthy — oftentimes within the first few years of its life).
- ID Theft Protection: Unsurprisingly, this voluntary benefit is growing in popularity. And while some people may be interested in purchasing ID theft monitoring or protection, they may have trouble picking a trustworthy company. If an employer offers protection through a specific company, employees may feel more comfortable enrolling.
- Life Insurance: Many employers offer life insurance policies in the amount of an employee’s annual salary at no charge, while allowing them to purchase supplemental policies if they feel it necessary. Others allow employees to purchase life insurance policies through their employee benefits broker.
How Can Voluntary Benefits Help Your Business?
Voluntary benefits are becoming increasingly common in our current economy, as the cost of healthcare increases sharply and gaps are still left by many health insurance policies. According to Aflac, 88 percent of employees view voluntary benefits as part of a comprehensive benefits package. For employers, this is an easy offering, as the cost of policies is typically paid in full by the employee.
Voluntary benefits can provide a stronger safety net, thus reducing financial stress in employees’ lives. We’d like to believe employees can save money on their own for emergencies, but in reality, this isn’t possible for everyone. A shocking percentage of Americans have little to no savings — certainly not enough to cover being out of work due to a disability for three or more months. Voluntary benefits can put your employees minds at ease, knowing their families will be cared for if something happens to them.
What questions do you have about voluntary benefits? Leave us a comment below or contact us. We’re happy to provide answers!
The JP Griffin Group consults for discerning companies coast-to-coast, ranging in size from 10 to more than 30,000 employees. In addition to our Scottsdale, Arizona headquarters, we have bi coastal offices in Seattle, WA and Washington, DC.