It can be easy to treat all business owners and decision makers the same. They’re in charge. They’re responsible for what benefits their employees will be offered. They have jobs to do. But treating owners of America’s small businesses – and their employees – the same as officials at large companies and corporations can be a costly mistake.
Small businesses of 100 or fewer employees have different backgrounds, needs and concerns than those at larger firms, according to a 2013 Colonial Life/Unum poll conducted by Harris Interactive. And those small businesses employ more than 38 million of America’s workers.
Employees at small businesses are more likely to be women, younger, single and working part-time. They’re more likely to have young children in the household and lower personal and household incomes. They’re less likely to have college degrees and participate in employee benefits plans. This means employee benefits can be very valuable and benefits education even more important.
While at least two-thirds of businesses with more than 100 employees offer key insurance benefits and options to their employees, it’s not the case with small businesses. According to the Colonial Life poll, only 50 percent of small businesses offer health insurance and are unlikely to offer dental (43 percent), vision (39 percent), life insurance (37 percent), long-term disability (33 percent) or short-term disability (31 percent) benefits.
Yet employees in small businesses expressed interest in purchasing the following types of insurance benefits in a 2014 Colonial Life poll conducted by Harris Interactive:1
- Life insurance — 49 percent
- Short-term disability insurance — 46 percent
- Critical illness insurance — 40 percent
- Accident insurance — 40 percent
- Cancer insurance — 21 percent
By educating small business owners on the best options in employer-paid plans and the ability to expand benefits packages through voluntary benefits, you can help employees at America’s small businesses protect their assets.
Meeting the need for life insurance
This summer, Colonial Life announced a new group term life insurance product that allows employers to conveniently provide a popular benefit to employees. Term life insurance is an affordable option that can help employees and their families replace lost income in the event of a death and is guaranteed-issue, meaning no health questions for employees. The employer-paid option uses a composite rate structure, which means the same rate for all employees, regardless of age or tobacco use.
The group term life insurance coverage also can be offered on an employee-paid basis and provides options tailored for both large and small accounts. For small accounts, program administration is simple.
Voluntary benefits: More choices without more costs
More good news: Providing small business owners with benefits options can be done with no direct cost to the business owner.
Too many small businesses fail to offer employees access to the very choices that could nurture employee loyalty and tenure.2 Experts say that doesn’t have to be the case: With voluntary benefits, small business can — and many do — offer a wide range of benefits geared toward the unique company culture.3
Voluntary benefits — personal insurance coverage workers may buy through employers at a lower rate than they could get on their own — are a great way for your clients to offer a range of competitive benefits without damaging the bottom line. The value for employers starts with group rates, and they gain extra points in the employee loyalty ledger for convenience with payroll deduction options. And that can translate into enhanced employee retention: Small business workers who are satisfied with their benefits are more likely to feel loyal to their company.4
Expanded benefit choices, low cost and convenience are three very big reasons for small employers to dive into voluntary benefits. If keeping top talent motivated and productive is important to your clients, then find out today how easy it is to offer the benefits those highly valued employees crave most.
1 Colonial Life online survey of employees by Harris Interactive, Mar. 28-Apr. 1, 2014
2 Babushkina, Y., “What Small Businesses Know About Health Care Reform,” LIMRA, Jan. 2013
3 Power, R., “Employee benefits: The secret weapon in the talent war,” Marketwatch, April 14, 2014
4 “Benefits Breakthrough: How Employees and Their Employers are Navigating an Evolving Environment,” Insights from MetLife’s 12th annual U.S. Employee Benefit Trends Survey, 2014
About the Author
Rich Williams is the senior vice president for growth markets at Colonial Life & Accident Insurance Company. Colonial Life is a market leader in providing financial protection benefits through the workplace, including disability, life, accident, cancer, critical illness and hospital confinement insurance. The company’s benefit services and education, innovative enrollment technology and personal service support more than 80,000 businesses and organizations, representing more than 3 million of America’s workers and their families.
For more information about Colonial Life’s products and services, contact Williams at 803-678-6440, e-mail him at RWilliams@ColonialLife.com
or visit www.ColonialLife.com. Or connect with Colonial Life at www.facebook.com/coloniallifebenefits, www.twitter.com/coloniallife and www.linkedin.com/company/colonial-life.
