As four generations work side-by-side, the challenge of viability expands
by Meredith Ryan-ReidMs. Ryan-Reid is senior vice president of Distribution Development & Benefits Delivery, Group Benefits at MetLife.
Organizations today are experiencing unprecedented change in the nature of work, the workplace and their workforces. Not only are employers facing increasing pressure to retain top talent and cultivate a productive, engaged and loyal workforce, but they have to do this while keeping costs down.
Adding to this, the workforce is more diverse than ever. Multiple generations are working side by side, and Millennials are now the workplace’s largest generation. At the other end of the spectrum, due to cost pressures and a desire to remain active, many Boomers are also returning to work. There are also more women in the workforce than ever before, including a growing demographic of single women. All have very different needs and wants when it comes to their benefits and what motivates them.
To engage today’s diverse workforce, customization is becoming increasingly important, especially when it comes to driving loyalty among employees. According to MetLife’s 15th Annual U.S. Employee Benefit Trends Study (EBTS), customization, or the ability to personalize benefits selections to meet specific age and life situation, continues to be important to employees. In fact, 72 percent of employees say having benefits customized to meet their needs would increase their loyalty to their employers.
Diverse Offerings for a Diverse Workforce
Employers who want to retain talent and increase productivity must meet employees’ diverse needs by offering a variety of voluntary benefit options. According to EBTS, employees are even willing to cover the cost in exchange for choice, with more than half of employees saying they are interested in their employer providing a wider array of non-medical benefits that they can choose to purchase and pay for on their own.
It’s no surprise then that LIMRA’s 2015 U.S. Worksite Sales survey found that voluntary sales grew for a fifth consecutive year. The same report showed that critical illness and accident insurance led the voluntary health product lines in terms of sales, each increasing by double digits year over year. Part of this upward trend is fueled by the growth of high deductible health plans, but another primary driver is that employees are increasingly looking to their workplaces for help with financial security.
More than 70 percent of employees consider the workplace to be the foundation of their financial safety nets. Furthermore, nearly two-thirds of employees agree that they’re looking to their employers for more help in achieving financial security through employee benefits. Not only are employees looking to supplemental health benefits to help offset out-of-pocket costs not covered by their medical plans, but they’re looking to other offerings like legal services plans, pet insurance, and even financial wellness workshops to help them get a better handle on their financial futures.
For the most part, employers are keeping pace with their employees’ top “must-have” benefits requests. They understand the important role voluntary benefits play in creating choice and responding to employees’ needs for financial security resources. Half of employers say they’re committed to continuing to offer non-medical voluntary benefits for the foreseeable future, and 45 percent say they plan to increase the number of non-medical benefits offered to employees in the next one to three years. Employers’ commitment to voluntary benefits continues to climb year over year.
Meeting Employees’ Benefits Needs
Despite the growing availability of voluntary benefits, gaps in employee understanding of the products persist. According to EBTS, only about a third of employees understand voluntary benefits like legal services plans, and, in fact, less than half of employees say they understand long term disability. Unfortunately, these low levels of understanding remain static year over year.
At enrollment time, this means employees may not select products that could help them reduce financial stress, potentially avoid financial hardship, and improve their overall financial well-being. For example, while more than 65 percent of all employees agree that non-medical benefits can help mitigate out-of-pocket expenses not covered by a medical plan, only about 25 percent of employees are enrolled in voluntary benefits like critical illness or hospital indemnity that can help to offset these costs.
In 2016, MetLife set out to uncover why employees aren’t taking full advantage of the benefits available to them through the workplace and found through our research that employees, regardless of employer or industry, have common unmet needs when it comes to their benefits:
- They can’t navigate the benefits information they receive
- They don’t have the time or energy to dig in
- They don’t know who to turn to with questions
- And, when they don’t understand their benefits, they assume they don’t need them
The research consisted of in-depth discussions with HR decision-makers and employee focus groups at four companies across diverse industries, including a global mass media company, a heavy manufacturing company, a multinational transportation company and a higher education and research institution, each with between 5,000 and 18,000 eligible lives.
When asked about their benefits, employees said things like: “There is all this information, but I don’t even know how to get it. Sometimes I accidentally find things,” “I wish I knew more about what the company offers – I feel like there’s a lot but I’m not sure what; if I had an easier way to get to the benefits information up front, I would know more,” and “If I had a question, I guess I’d look on the portal. I didn’t know there was an 800-number.”
Across the board, we found that because of these four common unmet benefits needs, many employees aren’t taking full advantage of the benefits available to them in the workplace.
This presents both a challenge for employers and their broker and consultant partners, but also a tremendous opportunity to improve benefits communication and, in turn, boost employee loyalty and retention. Solutions are going to require increasingly strong partnerships across the benefits ecosystem. That’s why at MetLife, we recently put in a place a new enrollment strategy to reimagine employee benefits enrollment in partnership with employers and their trusted broker and consultant partners.
The Role of the Broker or Advisor
Brokers and advisors are an integral piece of the enrollment puzzle. According to MetLife’s EBTS, more than 60 percent of employers say they’re focused on improving the effectiveness of benefits communication, and this is up year over year. However, with a diverse workforce with varied benefits needs, a complex benefits landscape and often very lean HR teams, employers are relying on their broker and consultant partners more than ever.
In fact, nearly 60 percent of employers said that an insurance agent or broker had an impact on helping them choose their company’s benefits. Not only are employers turning to brokers for help managing costs, but 62 percent of employers say they are looking to brokers to provide insights on benefit trends and employee needs, and nearly the same amount (60%) are looking to brokers for their expertise on creating employee financial well-being strategies. Last year, only about half of employers said they were looking to broker partners for these needs, illustrating how the role of the broker, which has always been important, is becoming even more so.
As a broker discussing benefits enrollment strategies with clients this year, consider recommending four immediate actions employers can take to better deliver on employees’ unmet needs and create a more productive enrollment experience:
- Streamline enrollment materials to help employees navigate. Employees are overwhelmed by the information explosion at enrollment time. According to EBTS, about 40 percent of employees are confused by the information they receive from their employer about their benefits. Help cut out the clutter so employees can easily find succinct information that’s relevant to them, and prioritize the content so they get the most important information up front.
- Create simplified, snack-able information that’s easy for busy employees to digest. According to EBTS, more than two in five employees are stressed by the enrollment process and many think it’s too complicated. During their busy work days, they don’t have the time or energy to dig in, and in the evenings or on weekends, life gets in the way. This is why so many employees wait until the last minute to enroll. By creating simple, “snack-able” content, employees can take information in quickly, yet still make informed decisions for themselves and their families.
- Provide well-equipped representatives for questions. According to EBTS, only 37 percent of employees strongly agree that benefits communications give them the information they need to make the best decisions. When they have questions, one of employees’ most preferred resources is one-on-one consultations with benefits enrollment representatives, EBTS showed. However, many employers aren’t providing this opportunity. Encourage employers to leverage external resources. There are a variety of benefits communications firms that can assist. Making a recommendation for a benefits communication firm that exceeds your clients’ expectations will not only make a big difference for their employees, it will have a big impact on your relationship too. If you don’t have a relationship with an enrollment communications firm, tap into your benefits provider. Carriers should be your partners in ensuring an optimal enrollment environment.
- Provide personalized information aligned with life events to make benefits more relevant. With multiple generations working side by side, reaching each with the same communication or message is unlikely. Only about half of employees say that their employers’ benefits communications address their life stage and personal situation; yet, on the whole, employees say that personalized messages and materials reflecting life events or life stages would be effective for learning about benefits, according to EBTS. Given the diversity of the workforce today, this is more important than ever for employers to take into consideration.
- By supporting employers in taking steps to improve employees’ benefits enrollment experiences, you’ll add value as a trusted partner and set employer clients up for success as they work to retain their top talent, cultivate an engaged and productive workforce and meet employees’ increasing expectations that employers address their personal needs and support them in achieving their financial well-being goals.
Get additional insights from MetLife’s 15th Annual U.S. Employee Benefit Trends Study at benefittrends.metlife.com. ◊