Navigating the similarities and differences between individual and voluntary benefits can seem challenging. Which ones do your employees want? What can employees get from individual benefits that they can’t from voluntary? How can benefits attract and retain great talent?
Before we answer those questions, let’s start with what voluntary and individual benefits are.
Voluntary benefits are employee-sponsored (employee-paid) benefits. This means that the employer offers benefits to employees at no additional cost. The employee pays the full cost of the plan, but it’s made available to them through their employer. This offers employees access to purchase additional benefits if they choose to do so in addition to the basic benefits their employers may provide.
Different types of voluntary benefits employers can provide include:
For more information on voluntary benefits, read our complete guide.
Unlike voluntary benefits, individual benefits are not supported by the employer. The individual pays for health insurance out of pocket based on his or her specific needs. Those who opt for individual benefits must pay for their insurance, however, they do have the ability to tailor their benefits plans to what they want.
It’s less typical for employees who are offered voluntary benefits through an employer to choose individual benefits.
Typically, those who choose to opt for individual benefits are:
Here is a list of the major similarities and differences between the two to help you navigate what benefits you want to provide.
Voluntary and individual benefits have a few similarities to consider when choosing between the two.
There are a couple of key differences between voluntary and individual benefits coverage.
Voluntary benefits are sponsored by your employer: Voluntary benefits are only offered through employer-sponsored healthcare plans. Those who are not employed do not have access to voluntary benefit options. The employer also chooses what options are offered and what the coverage levels are. As an employer, this can be a great way to differentiate your company.
Individual insurance is completely paid for by an employee: Some business owners pass the cost of voluntary benefits on to their employees, though it is not required. Some employers will also cover a portion of voluntary benefit elections for their employees. With individual coverage, the employees take the entire cost. They can, however, customize their benefits plans to their specific needs.
At SBMA, we understand how important your employees are to your organization. Offer your employees the most options for coverage. When you offer your employees more options when it comes to benefits, they will likely have higher engagement levels as they feel you care for their wellbeing. Contact us to learn more about the voluntary benefits you can offer your employees.
Continue reading for more information on how worksite benefits can help with your employee retention.
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