
This year's primary concern for most CHROs is the absolute spending on employee benefits. Nearly 40% of CHROs have observed that the business environment impacts their benefits budget. Premiums on benefit plans are expected to increase by 11% this year because medical inflation does not make things easier, a report on 'The State of Employee Benefits 2024' launched by Plum, an insurtech platform, shows.
The report, covering 4,500+ companies, revealed that the median sum insured has risen 66% from Rs 3 lakh to Rs 5 lakh. There has also been a 2x uptick in flexible benefits adoption (insurance schemes that employees can personalise), a 15% increase in companies offering maternity benefits, and a 110% surge in companies offering comprehensive healthcare (preventive and primary).
Amid tight budgets, companies have aimed to continue investing in employee health and well-being even as insurance plans and benefits are now being crafted with greater care and a focus on sustainability.
Abhishek Poddar, co-founder and CEO, said, “We are in an era where ‘modern benefits’ are equated to employer brand and employee retention. Our study reveals 76% of employees weigh the quality of benefits as a factor to stay at a company or leave. Benefits also have evolved - it is no longer just insurance, but employee health and wellbeing that is a matter of concern for employers who care. Despite tight market conditions, it is heartening to see companies adopting sustainable policies, keeping in mind employee morale.”
Trends observed by The State of Employee Benefits 2024:
-- Unicorns and global startups’ covers are comprehensive, with a good mix of telehealth included. These companies are setting the actual benchmarks for the rest. Though, when it comes to benefits, size doesn’t matter; intent does.
-- Global startups lead with a median sum insured at Rs 10 lakh, while startups and smaller companies offer between Rs 1- Rs 6 lakh.
-- Modern treatment coverage is widely adopted, with 95%+ for global startups and a significant majority for other types of companies.
-- Outpatient Department (OPD) benefits are gaining importance among unicorns at 30%, indicating a focus on accessible day-to-day healthcare.
-- LGBTQ+ inclusive health coverage is provided universally by global startups and unicorns, and it is widely adopted across other company sizes.
-- Maternity benefits average over Rs 1 lakh in global startups, showing a commitment to supporting growing families.
-- Companies have started adopting accident and disability insurance, with Unicorns leading the charge with 90% and global startups with 60%, and the median being 45%.
-- Term life insurance is gaining prominence, with Unicorns covering 75%, global companies 30%, and median among the rest is 14%.
--Telehealth services, crucial for preventive and primary healthcare, are almost universally included in global startups and widely incorporated across other firms, although speciality services may not be included in smaller companies.
That said, the top 10%ile provides unmatched benefits irrespective of size. They view benefits as an investment into great talent - an organisation’s key asset. As per the report, these companies also believe in providing their employees with the ‘care’ they deserve.
Saurabh Arora, Co-founder and CTO of Plum, said, “Challenging market conditions shouldn't prevent caring companies from offering tailored benefits. We've been collaborating with our clients to create sustainable policies that benefit both employers and employees."