The Time for Voluntary Benefits Has Arrived | Featured Article by Michael Castrillon

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Published: 09.15.2020

For decades, benefits experts have forecasted that Voluntary Benefits would one day be the only way Specialty Benefits would be sold. As time has passed, the Northeastern United States has avoided this prediction with employer-paid benefits still reigning supreme.

It has taken a worldwide pandemic, the need for social distancing, the creation of an entire new subsection of benefits and unimaginable unemployment to finally turn the tide of benefits offerings toward Voluntary Benefits offerings.   

If there ever was an example of a “perfect storm” in Specialty Benefits, 2020 is certainly a front-runner. As we all settle into our daily COVID Era routines, there are several examples of just how Voluntary Benefits offerings are going to be dominating the landscapes of the market for years to come.

Voluntary Benefits plans have come a long way, and the COVID-19 pandemic is further paving the way:

1. Prior to COVID-19, an entirely new line of lifestyle benefits created a variety of options for employees. Plans such as Pet Insurance, Legal Assistance, and ID Theft Protection all improved their offerings and made plans more affordable and accessible.
2. Also prior to COVID-19, traditional Specialty Benefits carriers began to identify the increase in benefits offerings and began to reduce participation minimums on core benefits such as Dental and Vision benefits. These far more liberal participation requirements truly began to open up the market since brokers no longer needed to worry about going through an enrollment and not meeting participation. When only one employee needs to enroll, offering multiple benefits to employees becomes far easier and more profitable for brokers.
3. COVID-19 called attention to long forgotten protections such as Life and Disability Insurance that the younger generations never felt obligated to buy. Once employees saw the impacts of losing their ability to earn a living or the death of a family member, these plans moved to the front of the line.
4. Employees who were let go suddenly discovered the importance of a benefits package that could be taken with them. Before the pandemic, these employees felt their next job could replace these protections. When the next job was not there, they had no other options. Many Voluntary Benefits plans provide employees with the opportunity to keep plans as long as the premiums are paid.
5. Our new virtual world has hastened the advent of online enrollment tools such as Employee Navigator or EASE. These platforms provide a far more efficient enrollment experience that allows for proper education for all protections offered to employees. Without the need for lengthy in-person meetings that seem to last forever, employees can now focus on the plans that interest them individually. This allows employers to offer more variety of plans, seemingly offering endless opportunities for products employees are asking for.
6. Employers are seeking out as many opportunities as possible to reduce overall costs, making Voluntary Benefits the only way to enhance benefits plans without increasing those costs.
7. The #1 complaint of employers when it comes to Voluntary Benefits is administering the plans once they are enrolled. Due to the explosion of Benefits Administrator platforms and premium consolidation programs such as Piedmont Pays, the employer is excused from having to do anything related to administration of these plans.

Brokers are now able to offer Voluntary Benefits without the fear of being able to implement the plans—all while enhancing current plans and not increasing costs to employers at all, and doing all of this without adding to the burdens of the employer. Voluntary Benefits have truly come a long way!

For further details, contact:
Michael Castrillon | Director, Specialty Benefits
michaelcastrillon@savoyassociates.com | 201.852.2018