The Next Generation in Group Benefits

BenefitsCanadaKanupriya Vashisht | October 21, 2014 – http://www.benefitscanada.com/benefits/health-benefits/the-next-generation-of-benefits-plans-57898

Going forward, smart employers will customize their benefits to stay relevant to employees of all ages

A little over a decade ago, group benefits were standard fare: traditional health, dental and vision, geared toward the undemanding average employee. But changing demographics have triggered a culture shift, prompting canny employers to fine-tune their total rewards packages to stay ahead of the hiring curve.

While early and late baby boomers and gen Xers continue to dominate the workplace, it’s the new kid on the block—gen Y—that is dictating much of the change. Statistics Canada reports that millennials currently make up about a quarter of the workforce—but that will swell to about 40% by 2020, when the majority of boomers will have retired, according to U.S. research. Employers that can cater to the needs and wants of this budding generation will have a competitive edge.

To understand gen Y aspirations, it’s important to realize that this cohort has grown up during a time when health has evolved from being solely about curing ailments to being more about preventive care and overall wellness.

Recent Sun Life Financial research shows that gen Y values group benefits less than older generations did at a similar life stage. While the importance of core medical and dental benefits remains, the gen Y focus is more on paramedical and lifestyle. Gen Yers also have a greater attitude of entitlement toward their benefits than older generations, with many gen Y employees making a concerted effort to max out their discretionary paramedical coverage.

With four generations co-existing in today’s workplace for the first time ever, one size no longer fits all. According toVic Medland, CEO of the Ontario Teachers Insurance Plan, “This industry has, so far, lacked real creativity and been internally focused for over 100 years, leaving room for disruptive change by an unexpected competitor as has happened in the music (Apple), TV and movies (Netflix), and home and auto insurance (Progressive) industries.” Group benefits today are at a crossroads and ripe for similar innovation.