05 Dec Employees Make Avoidable Benefits Mistakes
More than three-quarters (76 percent) of American workers who make decisions about benefits coverage during open enrollment admit to making mistakes about their benefits decisions, new research shows. In addition, 42 percent of workers say they have wasted money each year because of mistakes they made with their insurance benefits.
These findings are part of a survey of 2,220 U.S. adults ages 18 and older conducted in August 2011.
“Far too many American workers are making avoidable mistakes in benefits coverage decisions—from not meeting deductible amounts to contributing too little to flexible spending accounts—and, as a result of their lack of understanding or confusion, they often pay a price in multiple ways,” said Audrey, the vice president.
American workers say that when thinking about their choices for health insurance coverage, for instance, they sometimes, rarely or never understand everything that is covered by their policy options (74 percent of respondents).
Of those who choose the same benefits year after year, most say they sometimes, rarely or never have a full understanding of the changes in the policies each year (59 percent).
“While workers certainly need to invest more time in making better educated decisions, employers can help by understanding workers’ most common mistakes, explaining their impact and offering best-practice solutions,” said Audrey.
Strategies to Improve Communications:
Companies can reap significant rewards by developing more-effective benefits communications, including healthier, more-protected and more-engaged employees. According to some insurance companies, best practices to consider include:
• Survey your employees. Electronic communications have made it easier than ever to survey workers at minimal cost. Yet little more than half (52 percent) of organizations conduct surveys that increase their understanding of employees’ satisfaction with benefit offerings. Even fewer—43 percent—survey their employees’ understanding of benefits communications. Taking the time to understand the preferences and needs of their workforces can help employers increase employees’ satisfaction with their benefits packages.
• Communicate year-round. Many employers communicate their benefits programs to workers just once or twice a year, often overwhelming them with information at open enrollment or during the hiring process. Expecting employees to comprehend and retain large amounts of benefits information all at once is unrealistic and unfair. Instead, employers should present elements of their employee benefits programs to employees throughout the year. By doing so, they’ll help employees retain the information, making open enrollment a smoother, easier process.
• Consider retaining a benefits consultant or broker. Giving employees the opportunity to speak directly to a benefits advisor or a representative from an insurance carrier can be an effective means of education. In fact, 49 percent of workers agree that they’d be more informed about benefits if they sat with a consultant or broker during enrollment.
By SHRM Online staff