Many working adults view open enrollment as a chore that must be endured rather than an opportunity to improve their family’s financial security.
How bad is it? In a recent survey by Haven Life, half of respondents would rather let their spouse have total control of the remote control on Thanksgiving than spend time reviewing their health insurance and benefits. Furthermore, even many who try to make smart choices don’t fully understand their options.
“The results of our fourth quarter survey show that while employer-sponsored open enrollment periods are the primary way Americans purchase their insurance benefits, there is a significant education gap within that process,”; said Wade Seward, director of distribution strategy at Haven Life. “We found that 29% of respondents indicated they have little or no understanding of the life insurance benefits their company offers them.”
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Drilling into the details reveals even more fear and confusion. (Warning: What follows is not pretty.):
- 86 percent of adults surveyed say their company offered health insurance plans, while 12% say their company does not offer health insurance and 2% were not sure.
- A third of respondents have little or no understanding of the healthcare benefits their company provides.
- Seventeen percent say they have some or no understanding of the difference between health insurance and life insurance benefits.
- Nearly three-quarters say their company offers life insurance benefits, while 21 say their company doesn’t and 8% weren’t sure.
- Fourteen percent of respondents whose company offers benefits do not know when their company’s open enrollment period begins.
- The largest group of respondents believe that less than 10% of their salary (40%) is a reasonable percentage to spend on benefits. The next largest group says 10% to 20% was fair. Only 20% felt it was fair to spend more than 20% of their salary on benefits.
- The largest group of respondents (25%) say they want their life insurance to pay out three to five years of salary to keep their family financially secure. The next largest group (17%) say six to eight years, but 7% say they would not feel their family would be financially secure regardless of the payout.
The survey results point to an opportunity for companies to make open enrollment more user-friendly and provide the resources employees need to make informed decisions.
“Life insurance is key to building a strong financial foundation and security for households, so employers must ensure their employees understand their benefits and can identify needs gaps—the gap between the benefits provided versus what is needed to create financial security,” Seward says.
For the rest of us, the best course of action is to set aside time—and a little patience—to fully understand our options during the open enrollment season. The good news? Applying for life insurance, another key component of well-rounded financial protection for you and your loved ones, can be done easily online through Haven Life. Get started by getting a quote today.