There are different types of voluntary benefits that employees can choose to participate in or decline. Voluntary benefits are optional perks that are typically employee-funded and paid for with payroll deductions.
Dental
Dental insurance is a valuable benefit that helps you maintain your oral health and save money on dental care. Group dental plans are designed to share the costs of dental services among a group of employees or members, usually through an employer or an organization.
Group dental plans typically cover a percentage of the costs for preventive, basic, and major dental services. Preventive services include cleanings, x-rays, and exams that help prevent tooth decay and gum disease. Basic services include fillings, extractions, and root canals that treat common dental problems. Major services include crowns, implants, and dentures that restore or replace damaged or missing teeth.
The level of coverage and the types of services covered may vary depending on the plan you choose. Some plans may have deductibles, copayments, coinsurance, or annual maximums that limit the amount of benefits you can receive. You may also have to choose a dentist from a network of providers to get the best rates.
Dental insurance is one of the most sought-after benefits by employees and job seekers. According to a survey by Employee Benefit Research Institute, dental insurance ranks third among the most important benefits in making a job decision, after health insurance and retirement savings. Moreover, nearly 60% of employees participate in benefits programs if dental is part of the program, according to a report by LIMRA.
Vision
Vision insurance is another wellness benefit that helps you take care of your eyesight and save money on vision care. Unlike medical health insurance that covers unexpected costs for eye injury or disease, vision insurance covers routine eye care, prescription eyewear, contact lenses, and other vision services at a reduced cost.
Vision insurance plans usually offer a fixed amount of benefits for eye exams, glasses, and contacts every year or every two years. You may have to pay a copayment or coinsurance for some services, or meet a deductible before the plan pays for anything. You may also have to choose an eye doctor from a network of providers to get the best rates.
Vision insurance is not only beneficial for your eye health, but also for your overall health and productivity. According to the American Optometric Association, regular eye exams can detect signs of chronic diseases such as diabetes, high blood pressure, and high cholesterol. Moreover, according to the [Vision Council], vision problems cost employers $22.8 billion in lost productivity each year.
Disability
Disability insurance is a crucial benefit that helps you protect your income in case you become unable to work due to an illness, injury, or even maternity. Disability insurance plans provide tax-free cash benefits directly to employees which typically cover as much as 60% of their regular income.
There are two main types of disability insurance plans: short-term and long-term. Short-term disability plans generally pay benefits for up to 90 days, while long-term disability plans can pay benefits for up to two years or longer. The amount and duration of benefits depend on the plan you choose and the severity of your disability.
Disability insurance is important because it can help you cover your essential living expenses and avoid financial hardship when you are out of work. According to the [Social Security Administration], one in four workers will experience a disability before they retire. Moreover, according to the [Council for Disability Awareness], the average duration of a long-term disability claim is 34.6 months.
Group Life
Group life insurance is a basic benefit that provides financial support to the family of an employee or member who dies while part of a company or organization. Group life insurance plans usually offer a lump-sum payment to the beneficiaries based on a multiple of the employee’s or member’s annual salary or a flat amount.
Group life insurance is often provided by employers or organizations at little or no cost to employees or members. Employees or members can choose to opt in or out of coverage, depending on their personal needs and preferences. Group life insurance coverage is not portable and is therefore lost for an individual when they separate from the company or organization.
Group life insurance is valuable because it can help cover final expenses such as funeral costs, medical bills, debts, taxes, and estate fees. According to the [National Funeral Directors Association], the median cost of a funeral with viewing and burial was $7,640 in 2019. Moreover, according to [LIMRA], 35% of households would face financial hardship within one month if their primary wage earner died.
Voluntary Life
Voluntary life insurance is an optional benefit that allows employees or members to purchase additional life insurance coverage at group rates through their employer or organization. Voluntary life insurance plans can include term, permanent, and whole-life policies that offer different features and benefits.
Term life insurance provides coverage for a specified period of time, such as 10, 20, or 30 years. Term life insurance is usually the most affordable type of life insurance, but it does not accumulate any cash value. Permanent life insurance provides coverage for the entire lifetime of the policyholder, as long as the premiums are paid. Permanent life insurance is more expensive than term life insurance, but it builds cash value that can be borrowed or withdrawn. Whole life insurance is a type of permanent life insurance that offers fixed premiums, guaranteed death benefits, and guaranteed cash value growth.
Voluntary life insurance is popular because it gives employees or members more flexibility and control over their life insurance needs and preferences. Voluntary life insurance plans are usually funded by the employee or member only through payroll deduction and are portable if the person separates from the company or organization. According to [LIMRA], 54% of employees say they would prefer to buy life insurance through their employer if given the choice.