A recent survey has found that 73% of employees in the United States want customizeable workplace benefits. Given the freedom to chose, workers may neglect life or disability insurance.
The LIMRA Secure Retirement Institute published its Employee Benefits Face Off report yesterday. It reveals that people from all age groups would prefer a "benefits wallet" approach in which they receive a fixed amount that they can spend on whatever options they wish.
“With four generations in the workplace, designing an attractive benefits package for all employees is challenging," says LIMRA Secure Retirement Institute analyst Michael Ericson. "As a result, employers are considering offering their employees the ability to control how they allocate their allotted money across their benefits."
The study found that health care coverage, retirement savings accounts, and vacation time were the three most popular workplace benefits, and nearly 90% of those surveyed ranked health care coverage and retirement savings plans in their top five most important benefits.
LIMRA warns that if a benefits wallet approach is adopted, some employees — especially younger ones — might ignore things such as life and disability insurance. The industry research organization notes that for more than one in three workers in the US (37%), their group life insurance is the only coverage they have.
Ericson says a benefits wallet approach could also have unintended consequences for savings programs. For example, resources allocated to buying vacation time would not be available for employer-matched retirement contributions.