Employers Want Guidance about Voluntary Benefit Options

Survey shows potential opportunity for experienced advisors to expand their financial practices.

Two of five employers that currently do not rely on guidance from a financial advisor say they would welcome such help with voluntarybenefit options such as retirement plans, life and disability insurance, as well as other protection benefits, according to a new study from Massachusetts Mutual Life Insurance Co.

The 2016 MassMutual Benefits Advice Study finds that 39 percent of employers without an advisor would find guidance regarding voluntary benefits from an experienced financial professional “extremely valuable” or “very valuable,” and 57 percent would characterize such help as at least “somewhat” or more valuable.

The study, conducted by Greenwald & Associates as part of a broader research project, surveyed 565 U.S. employers of different sizes, ranging from fewer than 25 employees to 1,000 or more employees.

“Employers increasingly are looking for help from financial advisors with voluntary benefits as their employees’ personal financial needs become more complex,” said Tom Foster, spokesperson and practice management leader for MassMutual’s retirement plan services. “Our research shows that advisors with the appropriate knowledge and expertise may have a clear and compelling opportunity to expand their financial practices to offer at least some guidance about voluntary benefits.”

The perceived value of guidance about voluntary benefits appears to grow steadily with the size of the employer, according to the survey. Firms that would characterize such assistance as “extremely” or “very” valuable range from 33 percent for those with fewer than 25 employees, to 55 percent for those with 1,000 or more employees. The percentages of employers that would see such advice as at least “somewhat” or more valuable range from 75 percent for the smallest employers to 80 percent for larger firms, the study found.

Top marks for advisors

Employers that already rely on an advisor for help with voluntary benefits are generally pleased with the guidance they are receiving. More than half (53 percent) of these employers rate the advice they received as “excellent” or “very good” and 77 percent rate it as “good” or better, the study found. Again, the level of satisfaction climbs with the size of the employer. The quality of guidance received from an advisor was rated as “excellent” or “very good” by half of employers with fewer than 25 employees and by two-thirds of employers with 1,000 or more employees, according to the study.

The effects of using an advisor

The research study also shows that employers that rely on help from an advisor are more likely to promote employee wellness and benefits utilization. Sixty-one percent of employers that rely on an advisor encourage employees to take advantage of both retirement savings and other voluntary benefits compared with 49 percent of employers that do not use an advisor. Also, 48 percent of advisor-supported firms promote financial well-being for their employees, compared to 33 percent of non-advisor oriented firms, according to the study.

Benefits offered

Regardless of whether an advisor is involved or not, the research shows that some benefits are more likely to be offered by employers than others. Overall, the employers who participated in the survey offered the following insurance benefits in order of popularity:

Employers that already rely on an advisor for help with voluntary benefits are generally pleased with the guidance they are receiving.

• Healthcare (92 percent)

• Dental (73 percent)

• Life insurance (72 percent)

• Vision (60 percent)

• Short-term disability (52 percent)

• Long-term disability (51 percent)

• Accident (32 percent)

• Employee assistance program (21 percent)

• Wellness program (20 percent)

• Critical illness insurance (17 percent)

• Cancer insurance (16 percent)

• Long-term-care insurance (13 percent)

“Ultimately, the benefits an employer selects should meet the diverse needs of employees as dictated by family situations, generational and gender differences, and personal finances, among other circumstances,” Foster said. “Experienced financial advisors may be particularly well suited to help employers come to grips with their employees’ benefits needs, including both wealth accumulation and wealth protection.”

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