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16 Feb 2016
by Liz Morrell

Benefits Shifts 2016: Employers use flex to shift insurance costs to staff

The cost of benefits is shifting to employees as employers increasingly switch to flexible benefits platforms, according to a new report from the Reward and Employee Benefits Association (REBA).

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The REBA/JLT Employee Benefits Shifts Research 2016, which surveyed nearly 300 pay, reward and benefits specialists working across a variety of organisation sizes and industry sectors between August and September 2015, found that the majority of those surveyed currently offered group life assurance, group medical insurance and group income protection cover as core benefits to some or all of their employees but most were looking to shift those to a flexible benefits set-up.

The study showed that private medical insurance provided by flex was set to see the biggest jump – up by 187.5% in 2016.

Life insurance provided through flexible benefits is set to increase by 85.7% and private income protection cover by 60%.

The trio of products currently form the bedrock of many employee benefit packages – alongside pensions and annual leave – and so the shift to flex is a significant one.

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Debi O’Donovan, partner at REBA, said that although the move of benefits to flex didn’t neccesarily mean cost savings for employers it does establish the conditions for shifting more of the cost of benefits to employees, which could have further ramifications. “Employees may also be forced to choose between continuing to take these benefits or spending their pots elsewhere,” she said.

Download the REBA/JLT Employee Benefits Shifts Research 2016