What are voluntary benefits?
Voluntary benefits are coverages and products made available to employees for elective purchase. Programs characteristics include:
- Often employee-paid
- Can be contributory or employer-paid
- Solicited and enrolled through a carrier or enrollment firm
Voluntary benefits, otherwise known as supplemental insurance or employee-paid benefits, are products, benefits, or services offered by employers but mostly or fully paid for by employees via payroll deductions at a reduced group price.
Common voluntary benefits
Provides cash benefits for expenses that may not be fully covered by major medical insurance. Pays specific benefit amounts for: Emergency Care, Specific Injury Care, Surgical Care, Supportive Care or Hospital Care.
Cancer and critical illness
Pays a lump sum benefit at diagnosis of covered illness or procedure. Covers multiple critical illnesses including but not limited to cancer, heart attack and stroke.
Disability income insurance
Offers income protection to cover monthly expenses if unable to work due to accident or injury.
Hospital confinement indemnity insurance
Hospital insurance pays a daily benefit for hospitalization due to accident or sickness.
Life insurance/Accidental death and dismemberment (AD&D)
Supplements existing life insurance coverage with additional protection if death or dismemberment occurs.
Value of voluntary benefits to an employer
Your company can benefit in many ways from offering voluntary benefits. A good set of voluntary benefits can:
- Increased expense control in the face of rising benefit costs
- Cost-effective way to supplement benefit cuts or reductions
- Provide great value through cost efficiency and convenience to your employees
- Aid recruitment efforts because certain benefits, such as dental and disability, are highly valued
- Help build loyalty and retention, reducing employee turnover and associated costs
Because of their cost efficiency and portability, voluntary benefits are becoming a central component of many companies’ overall benefits strategies.
Advantages of voluntary benefits for employees
Because of their cost efficiency and portability, voluntary benefits are becoming a central component of many companies’ overall benefits strategies, offering high value to employees, all with minimal effort and cost to the company.
Voluntary benefits can be either insurance or non-insurance products presented to employees to pick and choose from for elective purchase. Employers can offer value to employees with the following:
- Opportunity to access a broader array of benefits
- Freedom to choose benefits that best suit their needs
- Affordable premiums (often deducted on a pretax basis)
- Portable coverage
- Easy enrollment process
- More convenient and time-saving than buying on their own
- Convenience of payroll deduction
- No medical exams
- More lenient underwriting requirements
Working with one broker for all your employee benefits
Working with a single broker to coordinate your various benefits policies, especially when you decide to offer a variety of voluntary benefits, is a good idea. When all your benefits are presented together, you can avoid coverage gaps and take advantage of a broker who knows your business thoroughly and can help guide you through the process of choosing the best voluntary benefits for your employee group. UNICO can also provide you with comprehensive materials to help educate your employees on the voluntary benefits you offer.