Voluntary benefits such as pet insurance, critical illness insurance, ID theft insurance and a comprehensive student loan aid program were hot trends in 2017. And they are likely to move into the employer-sponsored space in the coming year, experts say.
“Employers are becoming very intentional in exploring voluntary plans,” says Amy Hollis, national leader of voluntary benefits at Willis Towers Watson.
Critical illness coverage and pet insurance became increasingly popular in 2017 as a response to the rising costs of healthcare, she says.
Critical illness insurance provides employees with a lump sum, based on the health condition, and provides another method to pay for that expense. Hollis notes that this benefit also can offset costs that can’t be filed with insurers, like travel costs. Likewise, the popularity of pet insurance is due to the surge in pet provider expenses.
“There’s been a spike in a benefit that’s been around for some time,” Hollis says.
She also notes that because employees are waiting until their 30s to have children, they place a heavy emotional weight in their pets.
Other benefits that were popular in 2017, such as identity theft protection and student loan relief programs, will likely be paid for by more employers in 2018, she says.
For example, financial services firm Baird will begin paying for a concierge-like service to protect employees from identity theft in 2018, a benefit that had previously been voluntary.
With major data breaches, including Equifax, employees have expressed a “huge spike in interest,” Hollis says.
“I would never wish for that to occur in any shape or form, but the silver lining is that it’s brought a true awareness [to the benefit offering],” she says.
Likewise, many employers offered some sort of student loan aid benefit, like refinancing or counseling, through their employee assistance programs. This year, however, employers like New York Life, Andersen Tax and MidWestOne Bank upgraded its student loan debt reduction benefit to include employer-sponsored loan repayments.
Most companies with a student loan repayment program contribute between $50 and $500 per month, with a lifetime cap of $10,000. Employers do not receive tax relief for offering this benefit, unlike retirement accounts.
With President Donald Trump signing the GOP tax overhaul in December, Hollis says it is a logical thought that employers will leverage the tax cut, which fell to 21% from 35%, to beef up their benefits package — a major attraction and retention tool.
“I do think that correlation is going to be made because there is no question that employers are really looking at their benefit program and their concurrent investment in those benefit investments,” Hollis says.
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