Voluntary Benefits
Voluntary benefits, otherwise known as supplemental insurance are products that are typically offered by employers and are mostly or fully paid for by employees via payroll deduction at a reduced group rate.
Benefits can include:
- Term or Whole Life Coverage
- Dental Coverage
- Vision
- Disability Income Coverage
- Accident Coverage
- Critical Illness Coverage
- Hospital Indemnity Coverage
- Identity Theft Coverage
- Travel Insurance
- Medical Insurance For Pets
Why do companies offer voluntary benefits?
Voluntary benefits are usually offered by employers as businesses can get a lower rate than individuals, and it is also inexpensive for employers to offer benefit programs. A business will use these programs as an incentive for employees and to retain a talented workforce. It is also an opportunity for an employer to decrease their payroll taxes.
Why are voluntary benefits important to an employer?
If a company can offer a voluntary benefits package, they can opt to reduce their core benefits package to save money while simultaneously offering personal insurance benefits at a reduced group price to employees who may not be able to afford this type of coverage on their own. In this way a small business can compete with larger, more established companies for top talent.
Are voluntary benefits pre-tax?
It depends on the type of voluntary benefit, some are pre-tax paid by employer and some are post-tax paid employee.