Employees Choose Protection Over Pay Rises
30th January 2014 Paul Andrews
Research highlights how much employees value their benefit package
New research from Group Risk Development (GRiD), the trade body for the group risk industry, suggests that more than two in five employees (41%) would be prepared to give up a pay rise in order to receive employer sponsored protection insurances as part of their benefits package.
Employees questioned were prepared to waive a pay rise of between 1 and 3% in order to receive Group Life Insurance and Group Income Protection from their employer. The findings highlight just how important a benefits package is in motivating and retaining key staff, with 44% of employees questioned stating that their benefits package makes them feel valued by their employer and 40% also saying that they were more likely to stay with an employer that offered a good range of benefits.
When asked which benefits they valued most, pensions undoubtedly ranked most highly with nearly two-thirds of employees (65%) placing them in their top three highest valued benefits. However, Income Protection, Life Insurance and Critical Illness benefits are also highly prized with 56%, 47% and 41% respectively placing them in their top three highest valued benefits. Employer sponsored protection benefits were valued more favourably than benefits such as discounted gym memberships (4%), dental insurance (9%), health screenings (18%) and even Private Medical Insurance (35%), which can be considered a cornerstone of many benefits packages .
Katharine Moxham, spokesperson for Group Risk Development, said: “At a time where balancing the books and recruiting and retaining the right team can be a delicate juggling act for many businesses, these findings make interesting reading. Our research highlights how much employees value their benefits package - and employer sponsored insurance - to the extent that many would opt for Group Risk protection benefits over a pay rise."
“Through the provision of Group Risk protection products (such as Group Life Assurance, Group Income Protection and Group Critical Illness), employers play a vital role in ensuring that staff and their families are adequately protected from the financial devastation that death or disability can bring. More than that, offering this provision appears to convey that the employee is a valued member of the team and actively encourages them to remain within the business."
“Offering a package of employer sponsored life, income protection and critical illness cover typically costs just 1-2% of payroll. Employers who make this provision for their work force are under no obligation to do so but those that do are well placed to make a real difference to them and their families in a time of financial and personal distress. What’s more they are also providing a vital means of reducing the UK’s sickness absence burden and producing a more financially resilient society.”