The value of life insurance as a workplace benefit

October 2024

Like many countries, Poland is experiencing a demographic shift due to an aging population and a shrinking workforce.  This can create challenges for the job market as demand exceeds the number of available job applicants.

According to Eurostat, Poland's unemployment rate is among the lowest in the European Union. In July 2024, the rate of registered unemployment in Poland was estimated by the Ministry of Family, Labour and Social Policy to be 5% - the lowest since 1990.  In July 2024, employers reported 94.2 thousand job vacancies. This is 3.2 thousand more than in July last year.¹

As a result, the demand for workers is very competitive.  To attract top talent, companies need to stand out with compelling job offers that provide a sense of security. This is particularly true for full-time, permanent positions — especially those that include life insurance.

Feeling secure is a fundamental human need, and work can play a crucial role in fulfilling it.

Research commissioned by Unum Life reveals that full-time employment significantly contributes to a sense of security, as noted by over half of the survey respondents.

However, it's not the only factor. Other elements that enhance a person's sense of security include family (46%), permanent employment (42%), being in a relationship (33%), and life insurance (29%).

In the hierarchy of areas that give respondents a sense of security, life insurance ranks 5th

Employees often prefer life insurance to other benefits, especially when the employer pays the premium.

In Poland, only 11% of employers fully pay the premium, 37% of employees pay the premium together with the employer, 46% of employees pay the full premium and 6% of respondents aren’t sure about the financing scheme.

Despite this, 79% of surveyed employees consider group life insurance to be one of the most attractive benefits, second only to vacation subsidies (88%) and additional paid vacation (85%)

In the ranking of desirable benefits, life insurance even wins over private medical care.

Joanna Grudnik, Director of the Group Insurance Sales Department at Unum Życie, advises that “Good group insurance programs not only provide benefit payments in case of serious illness, accident, or injury. Employees can benefit from medical checkups, medical consultations and a 24-hour medical hotline organizing medical services for them.”

Group life insurance has evolved significantly. It is no longer a one size-fits-all policy for all employees.

Today’s employees are carefully evaluating workplace group insurance offerings and prefer customizable coverage to suit their individual needs.

What matters most to employees are the type of events covered (67%) and the number of events covered (65%). Interestingly, the premium amount ranks third among the elements they consider important.

Employees are willing to pay more for enhanced protection, but that doesn't mean they don't expect assistance from their employer in this regard.

60% of companies offered several variants of group insurance to choose from and the possibility of selecting of additional options.

“Our analysis shows that employees are eager for additional variants, such as insurance for loved ones, or for cardiovascular, oncological or civilization diseases*. Additional variants give employees a wide range of options and the ability to tailor protection to their needs, age, family situation, health, or hobbies,” adds Joanna Grudnik.  *Diseases of civilization include Cancer, Diabetes, Obesity, etc.

More than half of the organizations surveyed offered several group insurance options to choose from.

Such an offer certainly requires companies to explain in detail to employees what the specific options consist of, how to enroll in the insurance, and whom and to what extent it covers.

Companies, on the other hand, do not have to handle these tasks themselves. Insurers have plans in place to implement and support employers in this area.

Michal Glasenapp, Group Policy Implementation Director advises that “Unum Życie has dedicated flyers, online materials, can set up meetings with employees; and for those who manage insurance in the company, such as HR employees, can provide workshops, training and modern tools to make their work easier.”

1. The extent of the insurance offered
2. How to report a loss
3. Duration of the insurance
4. When the insurance coverage begins
5. How to enroll in the insurance

• Provides employees with a benefit that addresses their greatest concerns, such as lack of money for medical treatment (medical riders can be added to the group life insurance plan in Poland) or serious illness
• Supplements medical care - Depending on the package selected, the insured employee or his or her covered relatives, can have preventive or diagnostic medical examinations, and in case of health difficulties, benefit from a pre-diagnosis or a second medical opinion. The insurer can also arrange rehabilitation, medical consultations and medical examinations or psychological assistance.
• The ability to use insurance as a benefit can be more valuable to the employee than a modest increase in salary. More importantly, it demonstrates the employer’s genuine concern for the employee’s wellbeing and sense of security

When employers offer life insurance as a benefit, it can be highly valued by employees. It not only enhances the overall compensation package but also demonstrates that the employer cares about the long-term well-being of their employees and their families. This can boost employee loyalty and job satisfaction.