Employees’ Views: Benefits Enrollment Experiences

May 2024

The 2023 enrollment season was one that many looked to with cautious optimism. Many indicators pointed to a promising environment that could generate meaningful results. Workers continue to rely on workforce benefits to address their insurance and related financial services needs. Employers view benefits as a central component in their value proposition to attract and retain workers. The employment picture remained strong with unemployment rates at historic lows. Wages continued to grow, and while prices remain high, the rate of inflation tempered.

At the same time, there has been a steady rise in the importance of digital capabilities in the enrollment process, including platforms that provide engaging, contemporary ways for workers to learn about, enroll and use their workforce benefits. Given this environment, how did workers approach their benefits decisions, and what factors influenced those decisions? How helpful were digital platforms in helping them learn about and make informed decisions regarding their benefits? To explore these topics, LIMRA recently surveyed over 900 workers who reported that their employer had an “open enrollment period” during 2023.

Benefits Enrollment

During that period, approximately 1 in 3 of these workers enrolled in or made changes to their insurance benefits. Those most likely to enroll or make changes were younger workers — Gen Z and Millennials — and those with children under the age of 18 in the household. Lower income workers were also more likely to enroll or make changes.

For those workers enrolling or making changes, they mostly modified coverage to an existing insurance benefit they already have, such as changing coverage amounts, plan type or adding/dropping family members, certain features or options. Fewer workers, 12 percent, enrolled in a new insurance benefit, while even fewer (5 percent) dropped one or more specific insurance benefit altogether during the enrollment period.

When reviewing and selecting benefits during their most recent enrollment period, the cost and affordability of the benefits played a significant role for most workers. More than 8 in 10 workers cited affordability and the cost of coverage as having at least some influence when reviewing and selecting their benefits; almost half (44 percent) said it had a lot of influence. Other factors that came into play include concerns about inflation and the chance of an economic downturn or recession. Younger workers and workers with lower household incomes expressed the highest levels of concern across these areas.

The Digital Experience

As remote and hybrid work models become mainstream, the need for digital solutions becomes more important for workers to learn about, enroll in and manage their benefits. The move to digital also streamlines and provides administrative efficiencies for employers. The use of digital platforms for workplace benefits is now commonplace.

More than 8 in 10 workers (85 percent) reviewed and made any desired changes to their insurance benefits on a website or portal, either exclusively (77 percent) or along with printed materials (8 percent). Just 15 percent used printed materials exclusively. It is important to note that while workers may have some flexibility as to the method they use to review and enroll in their benefits, more often this is driven by what the employer provides. Workers who are employed by large companies (more than 1,000 employees) are more likely to say they reviewed their benefits exclusively on a website or portal.

Digitalization is critical to aligning benefits delivery to both employer and generational preferences, driving new levels of engagement and enhancing the value of benefit programs. For the most part, workers rated the website or portal positively in helping them understand their benefits. However, just 1 in 4 workers who used a website or portal rated it “excellent.” The youngest workers, aged 18-29, expressed lower levels of satisfaction with the website or portal in helping them understand their benefits and make informed decisions. Many younger workers are digital natives, having grown up with technology. As such, their expectations are higher regarding digital engagement and experiences. Additionally, the youngest workers recently joined the workforce and are learning about their benefits for the first time. As a result, they may need more foundational education regarding their benefits, particularly those who are starting families; they may now have a greater appreciation and need for workplace benefits and the coverages those benefits provide. Interestingly, a worker’s confidence in their employer is reflected in their opinion of their benefits portal or website. Those workers whose confidence level in their employer is higher express greater satisfaction in the website’s or portal’s value in helping them understand their benefits. While one factor does not necessarily cause the other, it shows how an employee’s relationship with their employer can have a ripple effect on other (perhaps unrelated) factors.

Conclusion

Enrollment periods are important times during which employers can demonstrate the important role that workforce benefits play in helping their workers address their insurance and related financial services needs. To be successful, organizations must understand the needs of their workers, the influence of various factors on their benefits decisions and provide contemporary and effective ways — including digital — for workers to learn about and enroll in their benefits.