03 Oct Demand Increasing for Nonmedical Benefits
Studies repeatedly cite health insurance as the most desired workplace benefit among employees. However, recent studies show an increasing demand for nonmedical workplace benefits.
In November 2021, LIMRA reported that nonmedical benefits are expected to increase 20% by 2026. This data comes from a survey conducted by LIMRA and Ernst & Young.
Findings from the survey:
- Employees have a growing interest in nonmedical benefits, such as paid family and medical leave, life insurance, disability insurance and wellness programs.
- Employees say they are extremely or very interested in having their employers offer paid medical leave, life insurance and long-term disability insurance.
- This increased demand plus intense competition for top talent will fuel the projected growth for nonmedical benefits.
- Fifty-four percent of surveyed employers say they had a revenue drop in the past year. Nonetheless, most of them do not intend to scale back on benefits and nearly half are considering providing customized benefits to help attract and retain workers.
The survey also found that in the next five years most employers will rely more on benefits technology than they do now.
Nonmedical benefits come in many forms
Along with those listed above, nonmedical benefits include:
- Dental insurance.
- Vision insurance.
- Retirement savings plans.
- Flexible work arrangements, including remote work options.
- Legal services.
- Financial planning resources.
- Professional development opportunities.
- Caregiving benefits for employees with caregiving responsibilities.
- An employee assistance program.
- Paid time off.
- Student loan repayment benefits.
- Tuition reimbursement.
- Travel expense reimbursement.
- Down payment assistance for home purchase.
Note that dental insurance and vision insurance are technically different from medical coverage. That said, employers often include both dental and vision coverage in their health insurance packages.
Why employers should consider offering nonmedical benefits
MetLife reports that the vast majority of employees “who are very satisfied with their benefits are also very satisfied with their jobs.”
According to MetLife, offering nonmedical benefits can help employers succeed in the following ways:
- Higher productivity. Most employers say employees are less productive when worried about their financial situation. Providing benefits can alleviate some of the pressure.
- Competitive edge. Employees say “a wide range of benefits” is a reason to accept a job and remain in that job.
- Employee satisfaction. In other words, employees are happier and more engaged. Most employees also say that having personalized benefits would make them more loyal to their employer.
As for pricing, nonmedical benefits can be cost effective when purchased as a group benefit. In this case, (lower) group rates tend to apply.
If you’d like to offer nonmedical benefits or expand your suite of nonmedical benefits, speak with a benefits broker or consultant.
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