In the post-Covid world issues of health and wellbeing have risen up the corporate agenda. But at the same time the economic fallout has restricted many employers’ abilities to fund comprehensive benefit options.
Will a shift towards digital delivery systems and new technology help square this circle, with a move towards voluntary benefit options.
Advisers, providers and technology experts at a Corporate Adviser virtual round table event on the future of employee benefit provision discussed how new platform technology might facilitate change, provide a cost effective way to enhance health and wellbeing propositions for both smaller and larger corporates, and deliver products and services to employees that have been costed at prices closer to institutional rates than retail ones.
Previous efforts to increase the take-up of voluntary benefits have often stalled. Research has indicated that many employees place a relatively low value on a whole range of employee benefits — from pensions to critical illness policies. As a result they can be reluctant to pay for these themselves, even when offered at a discounted price through their employer.
This problem is exacerbated by the fact there is low visibility of many of these benefits through existing benefits systems.
Advisers said that a poor online experience meant that some employees were not aware of existing benefits paid for by their employer, and were missing out on the full value of these benefits as a result. In such cases take up of further voluntary benefits is likely to be small.
But there was agreement that more effective digital delivery, particularly through the use of a single platform, could address some of these issues.
Punter Southall Aspire principal Jon Webster said that this could help employers promote existing core benefits more widely, delivering a better ROI on this benefit spend.
Cloud8 founder and CEO Ian Rummels added that this could also lead to wider take up of voluntary benefits, creating additional revenue streams for advisers, and also enhancing the overall ‘value’ of the benefits package for employers, at relatively little additional cost.
Digital platforms also give greater opportunity to communicate the true value of voluntary benefits to employees. While some voluntary propositions focus on discounts with retailers that can often be found elsewhere on the internet, when it comes to protection insurances and health and wellbeing support services, whether standalone or with insurance, the institutional buying power of the workplace can often mean significantly lower prices than can be found in the retail space – with the added comfort of having been sourced via the employer as a trusted partner.
The recent Covid-19 crisis has brought many of these issues to the fore, with a marked changed in people’s attitudes to health and wellbeing.
Canada Life strategic propositions director Paul Avis said: “There has never been a greater awareness among the general public of both mortality and morbidity. Families are having conversations as to how they would cope financially if a partner died or was too ill to work.”
Group risk products can provide an essential lifeline at such times. But Avis said it is also the added support services — such as EAPs and virtual GP options — that are increasingly valued.
Cloud8 client strategy director Dipa Mistry Kandola said there is a focus not just on the services available to an individual employee, but on wider family benefits.
“For example, in many cases, partners and children can access virtual GP services, mental health helplines EAPs.” If this isn’t available there may be the option to add these as a voluntary benefit, she said, extending the coverage that is available, at a relatively low cost.
However, she said the full range of employee benefit options need to be easily accessed by staff, ideally via a laptop or mobile phone app.
“How much easier is it to discuss over dinner if you have the key details on your smart phone as to how much life insurance you have, or whether you can access a private GP service or mental health support line in an emergency,” she said.
“The information is there when you need it. People don’t want to have to find, then wade through a 20-page document they received when they joined the company.”
Webster said Covid-19 is putting increased pressure on health and wellbeing budgets, with many companies looking to either reduce spend in this area, or at least ensure it is better targeted to deliver maximum benefit.
Some financially-squeezed employers may be looking to reduce their core benefit offering, but augment this with a suite of voluntary extras.
Alternatively, for many SMEs who may not have offered group risk products, voluntary benefits offered through digital platforms can be a way to enhance their benefit offering without significant upfront costs.
Mistry Kandola added that it is important for advisers and consultant to look at these issues “thought an HR lens”. Employers are now more focused on health and wellbeing issues, but there will be increased scrutiny on budget, and ROI and VOI are likely to become even more important.
Towergate Health & Protection head of specialist Debra Clark said better use of technology to deliver benefit solutions also has the potential to increase engagement levels. This can also boost the value of benefit spend for employer clients.
In order to maximise engagement, Aston Lark director Sam Mistry said it is important that employees can access the full range of employee benefits through one platform. This should encompass more than just financial benefits, such as workplace pensions and protection products.
“This should link through to different providers, such as the AE pension provider, health insurers and group risk providers. Products that companies are legally obliged to offer (such as the pension) should be there with other voluntary options,” she said.
“It would be great if this is the same platform that staff also use to book annual leave, for example. This would be used regularly, and not simply downloaded on a phone once and forgotten about.”
Mistry added there is scope to extend this to other benefits, such as the cycle-to-work scheme, which offers tax relief on new bicycles if they are used for commuting. She reported that her company has seen increased interest in this scheme recently, given the reluctance people feel about using public transport in the wake of the coronavirus pandemic.
If people are using a digital platform regularly this gives companies the opportunity to promote key benefits they are providing, hopefully further boosting take-up, benefiting both employee and employers.
One Pension Consultancy partner Stephanie Windsor argued the key is to provide fresh content to and ensure this is lively and engaging. This might include videos as well as options to book face-to- face meeting with advisers on key issues, such as retirement planning.
Consultants can help with communications and messaging around many of these issues, she said.
Windsor added that better use of MI data can also help advisers and HR departments understand what services and messages are resonating with employees, helping to evolve the proposition going forward.
Avis added: “In our industry we are really at the infancy of how we can use this MI data to encourage greater take up of voluntary benefits. When you look at the way companies like Amazon utilise data, for example to profile customers, we have a long way to go.”
He gave examples of how Amazon will show related purchases. It is not hard to see how this could be effectively used to increased engagement and take up on a range of employee benefits, he added. Cowderoy Consulting CEO Jenny Cowderoy said it is important that consultants work with clients to ensure any digital benefits solution is helping support wider corporate strategies.
Bringing benefits into a single platform can ensure a comprehensive proposition that works to support key initiatives is created – whether to improve staff retention levels, reduce absences or increase overall levels of health and wellbeing in the workplace.
Mistry said that these digital innovations have the potential to change the conversation around employee benefits, particularly for advisory firms like hers who are talking to smaller and mid-sized corporates, who might employ up to 200 people.
“The revenue from voluntary benefits is a valuable new evolution of the business model and an effective way to target more SME customers.”
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