Looking at the impact Covid-19 has had on consumer trends and employee wellbeing, it’s easy to forget the less-visible impact it has had on other areas of HR and the workplace. One place we have seen consistent – and at times surprising – changes in is employee benefits. Today, let’s look at a few of the biggest changes we are seeing as a result of Covid-19, and how they may look in a few months’ time.
What positive changes have we seen?
While many employee benefits have taken downtrends due to social distancing measures around the world, there remain many benefits of great value to employees. One of the greatest uptakes we’ve seen this with is cycle-to-work.
With restrictions on public transport, cycle-to-work has seen a 66% increase in scheme orders received and a value increase of 74%, when compared to the equivalent period last year. It’s no wonder, when bicycles have become not only a crucial mode of transport, but also one of few ways to exercise safely and enjoy the outdoors. We’ve also seen a significant increase in sales for children’s bikes, as many are turning to cycling for recreation while leisure centres remain closed. Another trend of note is the upturn among London-based blue light and NHS services, where cycle scheme providers have been working directly with the Department of Transport to create more temporary cycling routes to take advantage of the reduced-traffic road environment. Even when restrictions begin to lift, we will likely still see a continued interest in cycle schemes, due to their ability to maintain social distancing, which we know will continue to be necessary.
An increased interest in protection
One industry that we are sadly seeing an increase in is that of protection and group risk benefits. A benefit that many see as a less-exciting necessity is now vital for those affected by the virus. Particularly among young people – who are often those least likely to take up additional coverage – we are seeing an increased interest. The group risk industry insures over 13 million people, and the protection market has virtually no exclusions within all policies for this situation, so we are seeing a large trend upwards for claims. After five or six years of quite a static market, we are now seeing a 40% increase in demand for partner life insurance, and 70% more enquiries to will writing benefits. The fact is, we all know we are vulnerable to this, so where we may usually overlook protection benefits, Covid-19 has forced us to address these more maudlin benefits head on.
Addressing travel concerns
While travel providers expect delays, individual cancellations, or even occasional widespread impact from weather, they really aren’t set up to withstand such a blow as the impact of a pandemic. Of course, Covid-19’s damage also follows on quite closely from when Thomas Cook went into administration in 2019, so it really is a difficult time for those businesses.
In terms of the effects this has had on employees and uptake, naturally we are seeing many people cancelling benefits or expecting refunds – and that is across the board, be it travel vouchers, insurance, or holiday purchase. It’s unlikely that this will change in the foreseeable future, as it comes down to ability to travel, desire to travel, and individuals’ financial outlook. All of which are heavily impacted by Covid-19. We don’t know when we’ll be able to travel again, as so many countries are handling Covid-19 differently, so there’s very little idea on travel restriction within one’s own country, let alone internationally. What’s more, a majority of people – even when allowed to travel, will be reluctant to leave loved ones, or cautious at the idea of going abroad. It seems likely that, for many employers, travel benefits will remain at the bottom of people’s list for quite some time.
Looking forward
As we look ahead to a post-Covid-19 world, many of these trends will continue. Employees’ priorities will be spending quality time with loved ones, so we can presume to see uptake in leisure and lifestyle benefits. There will be extended caution around travelling and maintaining social distance, so travel remains a non-option. We will also likely see building up your immune system as a hot topic, and emphasis on sleep, nutrition, preventing sickness etc. Not only will this cover more general wellbeing benefits, but we can expect to find more investment in technology – wearables, sporting equipment for use at home, leisure and entertainment.
Predictions say the UK economy will contract by about 7%, taking us three-plus years to recover. As employers, we are already seeing people’s financial wellbeing impacted, so it’s likely that employees will be understandably tighter on budget. For those working in reward and benefits, it will be more important than ever that we provide our people with the right benefits, serving them timely communications, and helping to support them where we can, as they move forward into a new normal, whatever that may look like.
Benefex’s world-class technology enables you to roll out your employee benefits schemes in an agile, strategic way that delivers an exceptional employee experience. Read more about OneHub – A home for all-things reward and benefits.