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Workers aren’t taking full advantage of benefits options

By Marli D. Riggs

Americans may be overly optimistic when it comes to thinking they won’t ever be diagnosed with a serious illness or experience an accident, according to a recent survey.

Six out of ten workers believe it’s not very or not at all likely they or a family member will be diagnosed with a serious illness like cancer, and 55% of respondents say they were not very or not at all likely to be diagnosed with a chronic illness, such as heart disease or diabetes.

The 2012 Aflac Workforces Report analyzes forces impacting the trends, attitudes and use of employee benefits. The online survey of nearly 1,900 benefits decision-makers and more than 6,100 U.S. workers was conducted in January and February 2012 by Research Now.

According to the American Cancer Society one in three women and one in two men will be diagnosed with cancer at some point in their lives, says a recent survey. The National Safety Council says that more than 38.9 million medically consulted injuries occur in a year.

Meanwhile, another recent study from the American Heart Association shows that one in six deaths in the U.S. were caused by coronary heart disease.

“The fact that American workers aren’t aware of their medical risks and the potential financial impact of those risks is a very real concern that is only compounded when workers don’t take full advantage of available benefits options or adjust their savings strategies to be more prepared,” says Audrey Boone Tillman, executive vice president of corporate services at Aflac.

“Now, more than ever, people need to understand that wellbeing means more than just good health — it’s being prepared for the reality of whatever life may bring and taking the necessary measures to protect themselves and their families,” she adds.

Despite optimism about their physical health, the study reveals that American workers also are concerned about their financial health, and many admit they are unprepared to handle the financial consequences of a serious illness or accident in their family.

The report finds that:

  • Half of American workers are trying to reduce debt.
  • Fifty eight percent don’t have a financial plan to handle the unexpected.
  • Only 8% of U.S. workers strongly agree their family will be financially prepared in the event of an unexpected emergency.
  • Twenty-eight percent have less than $500 (51% have less than $1,000) in savings for emergency expenses.

When asked how they would pay for out-of-pocket expenses due to an unexpected illness, 57% of respondents say they would have to tap into savings, while 30% would use a credit card and 19% would have to withdraw funds from their 401(k) plans to cover the costs.

“Most individuals are looking to their employers to educate them about all available benefits options, not just traditional benefits changes or choices, to better understand how they can have a more secure safety net,” says Tillman. “It’s critical for employers to effectively communicate year-round about how new benefit options, like voluntary insurance, can help with high out-of-pocket expenses associated with a serious illness or accident.”

The report also finds 60% of respondents would be at least somewhat likely to purchase voluntary health insurance plans if offered by their employer because these policies such as accident, critical illness and short-term disability are among benefits options that can help protect the financial security and well-being of the plan participant and their families.