blog – Page 46 – Saxon – Employee Benefits, Insurance & Wealth

Supporting staff to become more resilient has to go beyond telling them to ‘pull themselves together’

By Stephen Bevan

There seems to be no end in sight to the gloomy economic outlook: growth stagnant, unemployment still growing, fear of job losses high and pressure on workers and families building. Business continuity – keeping on track when the firm is buffeted by external shocks – has become a major challenge.

'Resilience' is needed by individuals, organizations and indeed whole communities, if we are to meet these challenges.

There is a lot of press about resilience at the moment. People are invoking the spirit of the blitz, the old-fashioned 'stiff upper-lip' and the need to 'keep calm and carry on' in a period of national adversity. But there has to be more to resilience than stoicism. We need to think of what ordinary people in business can do - or be - to help them cope with adversity, setbacks and uncertainty. Doing so will allow them to do a good job.

Numerous theorists have attempted to define psychological resilience. All agree on one important thing: that it improves an individual's chances to compensate for the uncontrollable negative impact of pressure. The Latin origin of resilience, resilire, means to 'rebound' and our use of the term reflects this quality. For many, resilience is related to flexibility, being 'both the capacity to be bent without breaking and the capacity, once bent, to spring back', in the words of George Valliant, in The Wisdom of the Ego (Harvard University Press, 1993). Applied to the work environment, it is a preventive attribute that equips individuals or a team to anticipate stress and maintain mental wellbeing. One other characteristic of 'resilience' is the ability to build and sustain adaptive capacity. This is beneficial to future work situations: 'being resilient encapsulates the flexibility in adapting to and overcoming adversity, so that personal growth can occur' (Mary Gillespie, PhD thesis, Griffith University, 2007).

I have worried for some time that, by contrast, our use of the term 'stress' has moved beyond its original meaning and in some quarters become negatively associated with learned helplessness or else has been over-musicalized. It is true some are subject to intolerable pressures from a number of work and non-work sources that damage their mental wellbeing and may make them ill. Indeed, the latest forecasts from Age Concern suggest over 7 million people of working age in the UK will have a mental health condition by 2030. Despite this, I find it hard to accept that nothing more can be done to enhance a natural capacity for resilience and adaptability, which - though it resides in us all - can be difficult to deploy effectively in troubled times. Supporting people to become more resilient has to go beyond telling them to 'buck up' or 'pull themselves together'.

We know from research that the resilient tend to have a sense of humor and realistic optimism under stress. They are also better equipped to view problems as opportunities and to learn from mistakes or failures. We know less about whether resilient people or teams are more productive or innovative, whether resilience distinguishes great leaders from also-rans and whether it can (or should) be spotted early during induction. Crucially, we need to know more about how to sustain workforce resilience as a driver of both personal wellness and business continuity.

I am not convinced engagement alone will deliver high performance and smart productivity growth, without a concerted effort to understand, develop and exploit the latent capacity of UK workers to bounce back from adversity. We will need these qualities in spades when the recovery gathers momentum.

by 6d-destani

Employees Placing Greater Reliance on Benefits

By Brian M. Kalish

Tough times have employees placing greater reliance on benefits for financial security, as employers affirm their commitment to sponsoring those benefits albeit with increased cost sharing.

That’s one upshot from the 10^th Annual MetLife Annual Study of Employee Benefits Trends released Monday. It found that since 2002 employer’s top benefits objectives -- controlling costs, attracting and retaining employees and increased productivity – have remained fairly constant. However, some delivery aspects have changed, such as the growth of auto-enrollment features in 401(k) plans. For advisers, the trends seem to point toward stable expenditures for core benefits, but greater funding from employees, including voluntary benefit purchases.

Nearly half of the 1,412 employees surveyed said that, because of the economy, they are counting on their employer to help them achieve financial security through employee benefits such as disability and life insurance and health.

For younger generations, that number is even higher. More than half (55%) of Gen X and two-thirds of Gen Y workers said economic pressures leave them counting on employers’ benefits program to help with their financial projection needs, according to the study, presented by MetLife’s National Medical Director Dr. Ron Leopold, an EBA Advisory Board member, at a MetLife Symposium in Washington.

Employers say they are hearing these concerns and rising to the challenge. Regardless of company size, of all companies surveyed, only 10% said they planned to reduce their benefits.

“The workplace has changed rather dramatically over the last decade since MetLife began doing its annual study,” says Anthony Nugent, executive vice president of MetLife. “Ten years ago, many Baby Boomers were planning to retire at age 65, Gen Y workers were just entering the workplace, and communication vehicles like Facebook and Twitter didn’t exist.”

As employees rely more on benefits, they are willing to bear most of the cost of them. Of surveyed Gen X and Gen Y employees, 62% said they are willing to bear more of the cost of their benefits rather than lose them.

And that may happen. While a third of employees believe their employer is likely to soon cut benefits, 70% of surveyed employers said they intend to maintain their current level of employee benefits. However, 30% will do this by shifting costs to employees. Some 57%, are interested in a wider array of voluntary benefits offered by their employer, as compared to 43% of Baby Boomers. The study also found that employers recognize this interest as 62% of employers agree that in the next five years employee-paid benefits will become a more important strategy than they are today.

With the ever-changing benefit landscape, loyalty continued to fall. Only half (42%) of employees feel a strong sense of loyalty to their employer, a seven-year low. Conversely, 59% of employers said they feel a very strong sense of loyalty to employees. One in three people would like to work for a different employer in 2012, but that number climbs to one in two for Gen Y employees.

by 6d-destani

Younger buyers buying asset-based LTC

By Marli D. Riggs

The sale of asset-based long-term care insurance protection continues to grow significantly, reveals research by the American Association for Long-Term Care Insurance.

More than half (53%) of male LTC buyers were under age 65, up from 48% in a prior year’s study, while women buyers under age 65 also increased to 50%, up from 44%, according to data gathered from insurers.

Meanwhile, premiums increased nearly 20% and the number of covered lives increased 13.5%.

"We expect the sale of asset-based or linked LTC products will continue to grow as they offer some highly attractive benefits to a category of buyers looking to protect their retirement savings," says Jesse Slome, AALTCI's director. "The growth of sales will only continue as more large players enter the marketplace.”

In 2011 the study finds that the initial single premium face amount of policies purchased was $100,000 or greater for 73% of new policies. Meanwhile, 96% of new life and LTC policies issued did not include a benefit increase option that bumped up available benefits to keep pace with inflationary growth of costs. Additionally the study of traditional individual LTC insurance policy sales finds that in 2011 some 96% included a growth option.

“At a time when long-term care is increasingly top of mind, these life insurance-based solutions avoid the ‘use it or lose it’ risk associated with traditional long term care insurance,” says Chris Coudret, vice president of OneAmerica. “In most cases, people make a single payment, effectively removing the risk of future premium increases.”

by 6d-destani

The Value of Discomfort

BY MIKE SULLIVAN

One of my colleagues has a paperweight on her desk with the quote, “Being uncomfortable is the price of growth.” I don’t know who said it, but I feel like printing the message on a flag and wildly waving the banner every time I encounter someone in our industry.

If you work in the employee benefits sector and are feeling nostalgic about your job, I suspect you’ll be in serious trouble in the not too distant future.

When dealing with the monumental change confronting our industry, the only viable option is to transform yourself and your approach to business. It requires expanding your knowledge base, developing new revenue streams and adding value. It means leveraging new resources, expanding your conceptual framework about compensation and repositioning your agency. You must do things differently. Much differently.

Most of us engaged in thinking about tomorrow spend a lot of time devising specific tactics to get there. Regardless of what innovative solutions we develop, I’ve recently come to a significant conclusion: The biggest obstacle standing in our way is our own resistance to change.

While it’s annoying for most of us to stretch past our comfort zones, I am sometimes astonished at the barriers others create for themselves. Once we get past our formative years, our species seems inclined toward inertia.

In reality, the past decade-plus in the health benefits business reinforced this behavior. For those of us specializing in small- and mid-sized markets, we could focus on the three Rs (reading, relationships and responsiveness) and watch our revenue grow at rates of 10 percent annually, simply because rates increased. In effect, if you were well informed and worked hard, you could watch your income grow. Compared to the energy we need to exert today, the effort was equivalent to pulling the lever on a Barcalounger to lift the leg rest.

To succeed in this evolving world, we need to unlearn what we know and take fresh approaches. While many of us already have new tools and resources in our sales solution kits, it is fascinating to watch advisers default to their old scripts. We want to stick with what’s familiar. So, how do we get people to stop saying what they’ve always said and acting as they always have? How can we inspire others to broaden their perspectives beyond their comfort zone?

As our industry undergoes transition, our leaders must motivate those around them to move with it. If we want to be agents of change and, quite frankly, remain relevant in the future, we must foster environments that encourage discomfort. After a couple of pleasant decades coasting around in a Lexus, the allure of learning to ride a unicycle disappears. It is too much work, and there is too much risk. Yet those who embrace such challenges will be rewarded. This applies equally to individuals and agencies, as well as sales and service personnel. Each of us must go through a bumpy phase until the new concepts and solutions become ingrained.

We must nudge each other to the edge of the proverbial cliff. When I prompt others in such a direction, I'm often met with these responses:

“I’m too busy to relearn so much.”
“I feel like you’re asking me to go back to school.”
“I can’t handle the amount, and speed of, change.”

When most of us entered into this business, we were highly motivated. Yet, I feel our success has inspired us to become…content. Perhaps success has us more inclined to play defense and hold on to things as opposed to playing offense and capturing new market opportunities. People who were A students at the beginning of their careers now perform at a different level. In essence, we do need to go back to school. For those operating independent agencies, following is list of subjects to master:

Analytics to support plan design decisions
Defined contribution software solutions
Emerging decision support tools for employers and employees
Health care costs and quality transparency tools
Truly integrated voluntary and worksite solutions
Payroll and benefits administration technologies and solutions
Care support solutions
Next generation wellness and lifestyle management solutions

Education has always been a powerful tool in the change arsenal. It certainly was in my personal tale. I grew up on the south side of Buffalo, N.Y. It’s a blue collar, Irish Catholic enclave with a church and bar at almost every intersection.

Alliances were divided between the area’s two steel mills and proximity to the closest Catholic school. I was surrounded by family and friends, and ensconced in a comfy existence attending P.S. 67 with all my buddies. During eighth grade, someone got the bright idea that I had the aptitude to attend a top prep academy in Buffalo, the elite Nichols School on the north side of town. I took an entrance exam and was admitted. My reaction: There’s no freaking way I’m going to that place.

It was gut-wrenching to leave my happy life and board multiple city buses for the daily rides to and fro, accompanied by adults commuting to work. I was ripped from everything I knew and felt like a poser trapped in a school populated by wealthy kids. Somehow I made peace with it. Accepting the change resulted in a rewarding outcome. I excelled academically and socially. I even saw the value of money and thought I might like some for myself one day. Initially, it was one of the most uncomfortable experiences I’ve ever had—yet it changed the trajectory of my life.

Those trips to Nichols each day of high school taught me a lesson I’ll never forget. Although I experience echoes of that same discomfort in my career these days, I am now exhilarated by the lure of what can come next. There’s a rough trip ahead, but if you don’t get on the bus, you’ll never reach your destination.

by 6d-destani

More than 80% of employers look to adviser for PPACA education

Beginning in 2014, the Patient Protection and Affordable Care Act requires employers with more than 50 employees to offer minimal essential health coverage to employees or be subject to a penalty. More than three-fourths of employers plan to continue to offer coverage for employees once this new requirement takes effect. However, a majority of respondents are also concerned about their ability to offer affordable health coverage to full-time employees.

The 2012 Health Care Reform Survey was conducted from January 6 to February 24 by Milwaukee-based Zywave, a software provider for the insurance and financial service industries. More than 7,800 employers nationwide participated in the survey.

Respondents are from 14 business sectors, with heaviest representation from services (18%), manufacturing (15%), nonprofit (11%), health care (10%) and construction (9%). Respondents spanned organization size: 43% with less than 50 employees, 17% with 50–99 employees, 27% with 100–499 employees and 14% with more than 500 employees.

Among those surveyed, 51% will definitely continue to offer health benefit coverage, 29 % will likely continue coverage, 3% will likely discontinue coverage and 1% will definitely discontinue or have already discontinued coverage. Meanwhile 19% are unsure what they will do when the requirement goes into effect in 2014.

“These findings are consistent with other recent surveys on the topic,” says Zywave attorney Erica Storm. “Given the uncertainty surrounding health care reform, employers do not appear eager to make big changes to their benefit offerings. Plus, employers remain concerned about competing for talent and seem nervous that dropping coverage could affect recruiting and retention efforts, despite other health care options provided for in the law.”

Other survey results include:

• 57% of employers responding are concerned about their ability to offer affordable health coverage to full-time employees.

• More than three-quarters of respondents have already seen an increase in their organizations health benefit costs or expect to see an increase as a result of PPACA provisions. Sixty-three percent of employers plan to pass these increases on to employees.

• PPACA requires group health plans that provide dependent coverage of children to make that coverage available to children up to age 26. In response to this requirement, 10% of employers surveyed increased the employee share of premiums or benefit costs for all coverage, 9% increased the employee proportion of dependent coverage cost and 2% eliminated dependent coverage.

• PPACA provisions that employers are most concerned about implementing and administering include: new reporting, disclosure and notification requirements (57%), the requirement to automatically enroll new employees in a health plan (40%) and additional W-2 reporting requirements (49%).

By Marli D. Riggs

by 6d-destani

Employers Continue to Look for Savings

The recent trend of shifting more health care and benefit costs to employees is showing no signs of letting up, according to new industry research.

A survey displayed that 22 percent of employers had medical deductibles of at least $1,000 this year for in-network services for their most popular plans, according to a report in Business Insurance, compared with just 8 percent in 2008. Twice as many employers (44 percent) imposed that deductible level on out-of-network services this year, the survey found.

"The biggest change in the past two years has been the increase in cost sharing with employees," said Michael Thompson, a principal. "Employers have been careful not to shift premium costs to employees, but have decided that the better way to shift costs is to require those who use health care services to pay more."

A separate report by Milliman also points to an increase in cost sharing in PPO family plans. According to Healthcare Town Hall, a website sponsored by Milliman, the survey found that the average premium cost of those plans this year increased $1,319, or 7.3 percent. Of the total cost increase, employers paid $641, while workers picked up the rest, totaling an increase of $275 in additional cost sharing and an additional $403 in payroll contributions..

Many employers, however, are searching for solutions beyond deductible increases. More employers -- especially midsize companies -- are turning to voluntary benefits to reduce their burden while still offering valuable benefits to their employees, according to a new LIMRA study. While employers traditionally have used voluntary benefits as a morale booster, nearly 80 percent of polled employers said they are most interested in voluntary worksite benefits because they bring no direct costs to their business, an onlinePLANSPONSOR news report noted. Two-thirds said they offer such benefits because it boosts their overall benefits package and allows workers to receive services cheaper than if they tried to buy coverage in the marketplace.

Although the trend of cost sharing is growing, U.S. workers are starting to see improvements in their overall compensation, which is creeping back toward pre-recession levels, according to a recent survey published on the Society for Human Resource Management's website. Only 9 percent of polled employers still have a pay freeze in place - down from 48 percent in mid-2010. More companies also are restarting bonus programs in an effort to retain top talent, the survey said.

by 6d-destani

Voluntary benefits can help contain company costs

To recap a previous blog post before jumping straight in to the questions: Voluntary benefit plans help employers round out their employee benefit offerings amid cutbacks in company-paid core health care, allowing employers to provide employees with additional benefits without bearing the weight of increasing cost pressures. These optional benefits can serve as value-added tools to help attract and retain top talent. Employees often pay 100 percent of the premium on these voluntary benefits through payroll deduction. Many of these benefits can be offered to family and friends as well. It's up to the employee; it's their money, and it's not costing the employer anything.
How can companies determine if adding a voluntary benefit program is the right choice for them?

They have to look at the true cost of running a company. Adding a voluntary benefit program can help offset those costs for them. Many companies are looking to ways to cut costs in the health insurance arena. It is extremely costly to maintain these major benefits. Often, what these companies are doing, ultimately, is passing those costs on to their employees.

Most voluntary benefit programs will help reduce that cost to employees because of the unique system of these benefits. If employers decide to lower their cost of mandatory benefits by passing some of that cost on to their employees, the employees can then offset those costs by participating in, for example, auto and home insurance programs saving them money over the traditional coves they would shop on their own.

What should companies look for in a voluntary benefit program?

You want to choose a company that can provide access to a variety of types of voluntary coverage and choice for your employees in the plans available. The last thing you would want to do is to present a variety of new benefits to your employees, only to have them ultimately be confused about the different types of coverage, from different sources and the costs of each one. You will want to work with a company that can provide a powerful, effective and simple voluntary benefits package that will be communicated clearly to your employees to achieve the highest level of participation and acknowledgement of the added perks.

What is the benefit of having several policies within the same voluntary benefit package?

Simply put, the renewal process for any benefit plan can be extensive to research and implement at the term of each and every policy, not to mention having to do that multiple times across multiple carriers for multiple plans. That is a huge migraine in the making just thinking about it! By having your plan developed and presented in a unified way to your employees, you will not only save administrative costs communicating these benefits, but you will also save time and money when it comes time to renew.

If you have additional voluntary benefit questions, please do not hesitate to contact our office to learn more!

by 6d-destani

Employers Get Creative with Tight Budgets....

Voluntary benefits are on the rise, but why is that the trend we are seeing? The economy is in recovery, but it is and will continue to be a slow climb up a very tall mountain. Company belts have not loosened and with the overall impact of healthcare reform still uncertain, it still may be quite some time before they let those belts out a notch or two.

According to HR Daily Report, this is why more employers are looking at Voluntary Benefits as a lower-cost incentive to attract new and retain existing talent. Employers are taking to offering employees everything from auto and home insurance to legal plans or even pet insurance. All of these being growing trends in employers looking to stay competitive. That's the assertion at a recent presentation at the 2011 Health Care Benefits NY conference. Outlined in the course of that presentation was a list of the most popular group voluntary benefits, now and in the future.