5 steps to making annual enrollment the most wonderful time of the year
It’s that time of year again. But before you plan your Thanksgiving menu or check off your gift list, it’s time to think about employee benefits.
VSP Vision Care surveyed employees about their attitudes around that special time of year when they must choose a benefits package and found that annual open enrollment is less popular than even tax season. While selecting your benefits may not exactly be a party, there’s no need for dread. They’re called benefits for a reason.
In spite of how important employer-sponsored benefits are, The 2015 Ninth Study of Employee Benefits: Today and Beyond from Prudential shows that people spend very little time considering their benefits. In fact, 32 percent spent just one to two hours on this important topic and 23 percent spent less than 30 minutes.
“The decisions we make during open enrollment can have an impact throughout the next year,” said James Gemus, senior vice president, head of product and business segments, group insurance for Prudential Financial. “These decisions deserve careful consideration and people owe it to themselves to consider every possible option. The research shows us that 55 percent of the time spent on benefit decisions was devoted to medical coverage. That’s certainly understandable, but they should be careful not to overlook other key benefits offered through their employer, like disability or life insurance.”
Make the most of this season’s open enrollment with these tips from Prudential:
1. Review all of your options. Employers and employees often look at medical, dental and vision as taking priority, and with good reason. However, don’t overlook other benefits, such as life and disability insurance, critical illness and accident insurance, which can complement these core offerings and are key to overall financial wellness. Seventy-one percent of Americans live paycheck to paycheck, according to the study Getting Paid in America. Disability insurance can help protect a portion of your income if you become too sick or injured to work and earn a paycheck. That's important because 62 percent of bankruptcies are based on a medical event and 78 percent of those who experience medical bankruptcies had health insurance. Critical illness insurance can help reduce the amount of out-of-pocket costs associated with certain serious medical issues. Insurance is a great way to help protect yourself financially from unexpected risks, so explore all of your options.
2. Take advantage of cost and convenience. Purchasing benefits like life or disability insurance through your employer can simplify things for you in two ways: First, you often pay less for them than had you purchased them on your own because you’re taking advantage of group rates; and second, you pay for these benefits through payroll deduction, which is not only simple, but also reduces your gross income, which may help lower your taxes.
3. Make the most of financial wellness programs: In a recent Prudential survey only 22 percent of individuals described themselves as feeling financially secure. Sixty-three percent said that employee satisfaction with benefits is important for their company’s success and employees are increasingly looking to those benefit offerings as a basis for financial security. So as more workers rely on their workplace as a primary source of insurance and savings — 35 percent of workers as of 2015 up from 30 percent in 2013 — employers are trying to ensure that every employee gets the most from the benefits they have. As an employee, don’t forgo this opportunity, ask questions both of your company and your coworkers to learn more about all of your options. It’s your benefits package but it only benefits you if you use it.
4. Look for tools to help make decisions. Often, employers will provide websites where you can not only enroll, but also offer tools like calculators and videos that can help you make sense of your benefits. This means getting the help you need in understanding your financial protection needs and selecting the best options to meet them. So take the time to explore them. It’s time well spent.
5. Ask for help. With all the options out there, it’s easy to feel confused. Speak with your employer’s benefits experts or HR resources. You can also speak to a financial professional and learn more about how to select the coverage that will fit your needs. You may be amazed at the good information that’s available.
The Prudential Insurance Company of America Newark, NJ