How Brokers See the Recession’s Impact on Employee Benefits

by Clive Riddle, June 4, 2010

Survey data on employee benefit trends and implications surrounding such drivers as the recession typically focus on data from large employers.  Large employers, of course, represent the clientele of the major benefit consulting firms that produce the majority of such studies.

Thus it is interesting to consider perspectives from the broker population, which typically represent smaller and mid-size employers. Colonial Life conducted broker surveys at two large national broker conferences during March and April, regarding the economy’s effects on benefits.

Here’s the results provided by Colonial Life, which indicate expansion of voluntary benefits, increasing employee contributions, and adding HSAs/HRAs are the top strategies:

• Added voluntary benefits options – 59%
• Increased employee contributions – 48%
• Added benefits options – 35%
• Added a health savings account – 29%
• Switched carriers – 28%
• Reduced benefits options – 27%
• Added a high-deductible health plan option with an health reimbursement account – 26%
• Increased employer contributions – 10%
• No change – 9%

In this environment, 80% of the brokers surveyed said voluntary benefits are very important to the overall benefits package they offer business owners. It thus could be beneficial for various stakeholders to do their homework on what existing and emerging products are being offered through the voluntary benefits market, and consider their implications.