Voluntary Benefits in 2021
What are voluntary benefits?
Oftentimes, voluntary benefits are extra benefits that employers are able to offer. that most often employees will pay 100% of now. The competition for good employees is getting tough, and many employers have begun to purchase voluntary coverage for their employees.
Another scenario we’ve seen with startups and very small businesses who maybe can’t Afford, full major medical coverage for their staff at the time will at least provide some sort of voluntary coverage for them. Then later on down the road, as the business grows and begins to produce more profits, the owners are able to reward their loyal employees with a more rich benefits package.
In the meantime ownership of the startup will do something like pay for some group accident coverage and critical illness coverage. Or maybe they don’t but they offer as many voluntary benefits as possible to their staff because it is no cost to them. In fact, employers benefit either way.
If they pay for the coverage they are able to write off the contributions, and if they don’t contribute and the employee pays 100% of the premium, the employer still saves on their FICA because less of their payroll is taxable.
We do encourage employees purchasing their own disability coverage to do so after tax, because pre-tax contributions towards disability creates a tax on the benefit amount. Long Term Care insurance premiums can be deducted from taxes and non-taxable upon distribution of benefits in most states.
The list of benefits that are considered voluntary benefits is quite extensive. So, for these purposes, We will keep it fairly traditional. but we will add more content and information to this website as we go along.and the industry continues to develop.
The most common voluntary benefits
- Disability, short and long term,
- Long term care,
- Gap coverage,
- Wellness plans,
- Accident insurance,
- Hospital indemnity insurance,
- Critical illness
“My Employees Aren’t Interested in Voluntary Benefits”
When it comes to voluntary benefits it has been our experience that, the best enrollment engagement and participation are enrollments that are coordinated with major medical and core benefits. We found that overall, employees are more receptive to what a benefits advisor has to say because they are in a place where they can consult with a professional who is an expert on how their existing coverage works and what kind of risks they may be exposing themselves to.
Education goes a long way for the employees and helps them understand and learn why some of these voluntary programs, like short term disability coverage, are so important and why health insurance and these ancillary products dental vision, do not cover everything. Simply asking the employee what they would do if they missed work for three months because of an injury that happened on the weekend?
,The Trifecta Wellness Program we offer employers in the Northwest actually pays the employees for participating and texting a health coach twice a month. Everyone participates when they realize
that the program is actually paying them money to be on the program and take actionable steps to achieve a healthier lifestyle. Imagine what that will do for their performance at work!
The excess cash produced by the employee for participating in the Trifecta Wellness Program allows them to purchase more benefits and have a better benefits package.
Voluntary benefits are most often, times employee paid, but we have noticed that in the increasingly competitive business world, more and more employers are starting to pay for voluntary coverage for their employees as well to keep the best staff that they can possible.